Order Code RL32904
CRS Report for Congress
Received through the CRS Web
Agriculture and Related Agencies:
FY2006 Appropriations
Updated September 28, 2005
Jim Monke, Coordinator
Analyst in Agricultural Policy
Resources, Science and Industry Division
Congressional Research Service { The Library of Congress

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The annual consideration of appropriations bills (regular, continuing, and supplemental) by
Congress is part of a complex set of budget processes that also encompasses the
consideration of budget resolutions, revenue and debt-limit legislation, other spending
measures, and reconciliation bills. In addition, the operation of programs and the spending
of appropriated funds are subject to constraints established in authorizing statutes.
Congressional action on the budget for a fiscal year usually begins following the submission
of the President’s budget at the beginning of the session. Congressional practices governing
the consideration of appropriations and other budgetary measures are rooted in the
Constitution, the standing rules of the House and Senate, and statutes, such as the
Congressional Budget and Impoundment Control Act of 1974.
This report is a guide to one of the regular appropriations bills that Congress considers each
year. It is designed to supplement the information provided by the House and Senate
Appropriations Subcommittees on Agriculture. It summarizes the status of the bill, its
scope, major issues, funding levels, and related congressional activity, and is updated as
events warrant. The report lists the key CRS staff relevant to the issues covered and related
CRS products.
NOTE: A Web version of this document with active links is
available to congressional staff at
[http://beta.crs.gov/cli/level_2.aspx?PRDS_CLI_ITEM_ID=73].

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Agriculture and Related Agencies:
FY2006 Appropriations
Summary
The Senate passed the FY2006 agriculture appropriations bill (H.R. 2744,
S.Rept. 109-92) by a vote of 97-2 on September 22, 2005. This bill includes all of
USDA (except the Forest Service), plus the Food and Drug Administration and the
Commodity Futures Trading Commission. The $100.2 billion Senate bill contains
$17.348 billion in discretionary spending and $82.82 billion for mandatory programs.
The discretionary amount is $609 million (+3.6%) above the Administration’s
request, and $518 million (+3%) more than the House-passed bill. The mandatory
level is nearly identical to the House-passed bill and the Administration’s request.
The House of Representatives passed the FY2006 agriculture appropriations bill
(H.R. 2744, H.Rept. 109-102) on June 8, 2005, by a vote of 408-18. The $99.7
billion bill contains $16.83 billion in discretionary spending, $90 million (+0.5%)
above the Administration’s request, and constant compared with the FY2005 level.
The mandatory level is identical to the Administration’s request and is $14.5 billion
(+21%) above the mandatory amount for FY2005.
The increase over FY2005 levels is due to greater mandatory spending on farm
commodity programs and domestic food assistance. About 83% of the total request
is for mandatory programs (primarily the Commodity Credit Corporation, crop
insurance, and most food and nutrition programs). The remaining 17% is for
discretionary programs, over which appropriators have direct control.
Both the House and Senate versions of H.R. 2744 reject or limit many of the
Administration’s proposed reductions to many conservation and rural development
programs, while concurring with others. Both versions effectively reject the
Administration’s proposal to redirect $300 million in foreign food assistance funds
to purchase food locally in foreign markets rather than buy U.S. commodities. This
has proven controversial with farm groups and private voluntary organizations that
distribute food aid. Neither measure follows the Administration’s proposal to cut
formula funds for the state agricultural experiment stations (under the Hatch Act) by
50% and to provide a new pool of competitively awarded grants.
Among the primary differences for conferees to resolve are the $514 million
difference between the total amounts in House and Senate versions, and two House
amendments that would delay country of origin labeling for meat products and allow
prescription drug reimportation. The White House has raised the possibility of a veto
if the drug import provision remains in the final bill.
Separate from appropriations, the FY2006 budget resolution (H.Con.Res. 95)
includes reconciliation instructions to the agriculture authorizing committees to find
program changes saving $173 million in FY2006 and $3.0 billion over five years.
Further action depends on how the House and Senate agriculture committees (not the
appropriations committees) carry out the instructions.
This report will be updated as events warrant.

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Key Policy Staff
CRS
Area of Expertise
Name
Division
Telephone
Report Coordinator, USDA Budget,
Jim Monke
RSI
7-9664
Commodity Credit Corporation,
Farm Service Agency
Crop Insurance
Ralph M. Chite
RSI
7-7296
Conservation
Jeffrey A. Zinn
RSI
7-0248
Agricultural Trade and Food Aid
Charles E. Hanrahan
RSI
7-7235
Agricultural Research, Extension, & Economics
Jean M. Rawson
RSI
7-7283
Animal and Plant Health Inspection,
Agricultural Marketing,
Geoffrey S. Becker
RSI
7-7287
Grain Inspection, Packers and Stockyards,
Food Safety
Rural Development
Tadlock Cowan
RSI
7-7600
Domestic Food Assistance
Joe Richardson
DSP
7-7325
Food and Drug Administration
Donna U. Vogt
DSP
7-7285
Susan J. Thaul
DSP
7-0562
Commodity Futures Trading Commission
Mark Jickling
G&F
7-7784
Division abbreviations: RSI = Resources, Science and Industry; DSP = Domestic Social Policy; G&F = Government
and Finance

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Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
USDA Spending at a Glance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Mandatory vs. Discretionary Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Action on FY2006 Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Appropriations Separate From Budget Reconciliation . . . . . . . . . . . . . 6
USDA Agencies and Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Commodity Credit Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Administration Legislative Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Crop Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Administration Legislative Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Farm Service Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
FSA Salaries and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
FSA Farm Loan Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Conservation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Discretionary Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Mandatory Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Agricultural Trade and Food Aid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Foreign Agricultural Service (FAS) . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Foreign Food Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Export Credit Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Export Promotion and Export Subsidies . . . . . . . . . . . . . . . . . . . . . . . 17
Agricultural Research, Extension, and Economics . . . . . . . . . . . . . . . . . . . 17
Agricultural Research Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Cooperative State Research, Education, and Extension Service . . . . . 19
Economic Research Service (ERS) and National Agricultural
Statistics Service (NASS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Meat and Poultry Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
“Downer” Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Horse Slaughter Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Marketing and Regulatory Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Animal and Plant Health Inspection Service (APHIS) . . . . . . . . . . . . 23
Agricultural Marketing Service (AMS) . . . . . . . . . . . . . . . . . . . . . . . . 25
Grain Inspection, Packers, and Stockyards Administration (GIPSA) . 27
Rural Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Rural Community Advancement Program (RCAP) . . . . . . . . . . . . . . . 28
Rural Business-Cooperative Service . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Rural Utilities Service (RUS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Rural Housing Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Domestic Food Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Programs under the Food Stamp Act . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Child Nutrition Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
The WIC Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Commodity Assistance Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Nutrition Program Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
New Program Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

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Food and Drug Administration (FDA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Counterterrorism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Food . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Seafood Safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Dietary Supplements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Prescription Drugs and Biologics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Medical Devices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Commodity Futures Trading Commission (CFTC) . . . . . . . . . . . . . . . . . . . . . . . 43
List of Figures
Figure 1. Gross Outlays, U.S. Department of Agriculture, FY2004 . . . . . . . . . . . 2
List of Tables
Table 1. USDA and Related Agencies Appropriations: FY1998 to FY2006
Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Table 2. Congressional Action on FY2006 Appropriations for USDA and
Related Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Table 3. Changes in Mandatory Conservation Programs . . . . . . . . . . . . . . . . . . 14
Table 4. Reductions in Mandatory Rural Development Programs . . . . . . . . . . . 29
Table 5. Directed Spending in the Rural Community Advancement Program
(RCAP) Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Table 6. FDA Counterterrorism Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Table 7. USDA and Related Agencies Appropriations,
FY2006 Action vs. FY2005 Enacted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44

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Agriculture and Related Agencies:
Appropriations for FY2006
Most Recent Developments
On September 22, 2005, the Senate passed the FY2006 agriculture
appropriations bill by a vote of 97-2 (H.R. 2744, S.Rept. 109-92). This bill includes
all of the U.S. Department of Agriculture (except the Forest Service), plus the Food
and Drug Administration and the Commodity Futures Trading Commission. The
$100.2 billion Senate bill contains $17.348 billion in discretionary spending and
$82.82 billion for mandatory programs. The discretionary amount is $609 million
(+3.6%) above the Administration’s request, and $518 million (+3%) more than the
House-passed bill. The mandatory level is nearly identical to both the House-passed
bill and the Administration’s request. The bill awaits action in conference
committee.
This report discusses provisions in the House and Senate versions of H.R. 2744
and compares them with the Administration’s request and the enacted FY2005
appropriations levels.
USDA Spending at a Glance
The U.S. Department of Agriculture (USDA) carries out its widely varied
responsibilities through approximately 30 separate internal agencies and offices
staffed by some 100,000 employees. USDA is responsible for many activities
outside of the agriculture budget function. Hence, spending for USDA is not
synonymous with spending for farm programs. Similarly, agriculture appropriations
bills are not limited to USDA and include related programs such as the Food and
Drug Administration and the Commodity Futures Trading Commission, but exclude
the Forest Service within USDA.
USDA gross outlays for FY2004 (the most recent fiscal year for which data are
available) were $80.1 billion, including regular and supplemental spending. The
mission area with the largest gross outlays ($45.4 billion, or 57% of spending) was
for food and nutrition programs — primarily the food stamp program (the costliest
single USDA program), various child nutrition programs, and the Supplemental
Nutrition Program for Women, Infants, and Children (WIC).
The second-largest mission area in terms of total spending is for farm and
foreign agricultural services, which totaled $17.9 billion, or 22% of all USDA
spending in FY2003. Within this area are the programs funded through the
Commodity Credit Corporation (e.g., the farm commodity price and income support

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programs and certain mandatory conservation and trade programs), crop insurance,
farm loans, and foreign food aid programs (see Figure 1).
Other USDA spending in FY2004 included $8.1 billion (10%) for an array of
natural resource and environment programs, approximately 70% of which was for the
activities of the Forest Service, and the balance for a number of discretionary
conservation programs for farm producers. USDA’s Forest Service is funded
through the Interior appropriations bill; it is the only USDA agency not funded
through the annual agriculture appropriations bill.
The balance of USDA spending was for rural development ($3.3 billion, 4.1%);
research and education ($2.5 billion, 3.1%); marketing and regulatory activities ($1.7
billion, 2.2%); meat and poultry inspection ($763 million, 1.0%); and departmental
administration and miscellaneous activities ($577 million, 0.7%).
Figure 1. Gross Outlays, U.S. Department of Agriculture, FY2004
Dollar s in Billions
($80.113 total)
F ood & Nutr it ion
56.7%
$45.39
F arm & Foreign Ag
Admin. & Misc.
22.3%
0.7%
$17.85
$0.577
Food Safety
1.0%
Resear ch
Natu ral Resour ces
$0.763
3.1%
10.1%
$2.467
Mar ket ing & R egulatory
$8.053
Rur al Develo pment
4.1%
2.2%
Source: CRS, using USDA data
$3.29
$1.723
Mandatory vs. Discretionary Spending
A key distinction between mandatory and discretionary spending involves how
these two categories of spending are treated in the budget process. Congress
generally controls spending on mandatory programs by setting rules for eligibility,
benefit formulas, and other parameters rather than approving specific dollar amounts
for these programs each year. Eligibility for mandatory programs is usually written

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into authorizing law, and any individual or entity that meets the eligibility
requirements is entitled to the benefits authorized by the law. Spending for
discretionary programs is controlled by annual appropriations acts. The
subcommittees of the House and Senate Appropriations Committees originate bills
each year that decide how much funding to devote to continuing current activities as
well as any new discretionary programs.
Approximately 80% of total spending within the USDA is classified as
mandatory, which by definition occurs outside of annual appropriations. The vast
majority of USDA’s mandatory spending is for the following programs: the food
stamp program and most child nutrition programs; the farm commodity price and
income support programs (including ongoing programs authorized by the 2002 farm
bill and emergency programs authorized by various appropriations acts); the federal
crop insurance program; and various agricultural conservation and trade programs.
Although these programs have mandatory status, many of these accounts
ultimately receive funds in the annual agriculture appropriations act. For example,
the food stamp and child nutrition programs are funded by an annual appropriation
based on projected spending needs. Supplemental appropriations generally are made
if these estimates fall short of required spending. An annual appropriation also is
made to reimburse the Commodity Credit Corporation for losses in financing the
commodity support programs and the various other programs it finances.
Table 1. USDA and Related Agencies Appropriations:
FY1998 to FY2006 Request
(budget authority in billions of dollars)
FY06
FY98
FY99
FY00
FY01
FY02
FY03
FY04
FY05
Request
Mandatory
35.8
42.3
62.0
58.3
56.9
56.7
69.8
68.3
82.8
Discretionary
13.8
13.7
14.0
15.1
16.0
17.9
16.8
16.8
16.7
Total Budget
49.6
55.9
75.9
73.4
72.9
74.6
86.6
85.1
99.6
Authority
Source: CRS, using tables from the House Appropriations Committee.
Note: Includes regular annual appropriations for all of USDA (except the Forest Service), the Food and Drug
Administration, and the Commodity Futures Trading Commission. Excludes all mandatory emergency
supplemental appropriations. Amounts reflect any rescissions that were applied to the final appropriation in certain
fiscal years.
The other 20% of the USDA budget is for discretionary programs, which with
the exception of the Forest Service are funded in the Agriculture appropriations act
(Forest Service programs are funded in the Interior appropriations act). Major
discretionary programs within USDA include Forest Service programs; certain
conservation programs; most rural development programs, research and education
programs; agricultural credit programs; the supplemental nutrition program for

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CRS-4
women, infants, and children (WIC); the Public Law (P.L.) 480 international food aid
program; meat and poultry inspection; and food marketing and regulatory programs.
Action on FY2006 Appropriations
On September 22, 2005, the Senate passed the FY2006 agriculture
appropriations bill (H.R. 2744, S.Rept. 109-92) by a vote of 97-2, after adopting 38
amendments. Only one amendment reallocated funding; most other amendments
restricted use of funds for certain activities, or were Sense of the Senate amendments.
The Senate Appropriations committee reported the measure on June 27, 2005,
following full committee approval on June 23, 2005, and subcommittee approval on
June 21, 2005. The bill includes all of USDA (except the Forest Service), plus the
Food and Drug Administration and Commodity Futures Trading Commission. The
bill awaits action by the conference committee.
The House approved the FY2006 agriculture appropriations bill (H.R. 2744,
H.Rept. 109-102) on June 8 by a vote of 408-18, after adopting 10 amendments and
deleting three provisions on points of order. The House Appropriations Committee
reported the measure on June 2, 2005, following full committee approval on May 25,
2005, and subcommittee approval on May 16, 2005.
Table 2. Congressional Action on FY2006 Appropriations for
USDA and Related Agencies
Subcommittee
Committee
Conference Report
Approval
Approval
Confer-
Approval
House
Senate
ence
Public
House
Senate
House
Senate
Passage Passage
Report
House
Senate
Law
H.R.
H.R.
2744
2744
H.Rept.
S.Rept.
Vote of
Vote of
109-102
109-92
408-18
97-2
5/16/05
6/21/05
6/2/05
6/27/05
6/8/05
9/22/05
**
**
**
**
** Pending
The Senate agriculture appropriations subcommittee had a sightly higher 302(b)
allocation for discretionary spending ($17.348 billion), compared with the allocation
in the House ($16.832 billion). The $100.2 billion Senate-reported bill contains
$17.348 billion in discretionary spending and $82.82 billion for mandatory programs.
The discretionary amount is $609 million (+3.6%) above the Administration’s
request, and $518 million (+3%) more than the House-passed bill. The mandatory
level is nearly identical to (only $4 million less than) both the House-passed bill and
the Administration’s request.
The $99.7 billion House-passed bill contains $16.83 billion in discretionary
spending and $82.82 billion for mandatory programs. The discretionary amount is
$90 million (+0.5%) above the Administration’s request, and constant compared with
the FY2005 level. The mandatory level is identical to the Administration’s request

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CRS-5
and is $14.5 billion (+21%) above the mandatory amount for FY2005. See Table 7
at the end of this report for a tabular summary.
The Administration released its budget request on February 7, 2005. The
Administration’s FY2006 budget request is $99.6 billion for the U.S. Department of
Agriculture and Related Agencies. This total amount is up $14.4 billion (+17%)
from the enacted FY2005 level of $85.1 billion,1 primarily because of the anticipated
increase of $9.2 billion (+56%) in FY2006 to reimburse the Commodity Credit
Corporation for its realized losses and $6.2 billion (+13%) for increases in mandatory
domestic food assistance programs.
Mandatory programs administered by USDA (primarily the CCC, crop
insurance, and most food and nutrition programs) account for about 83% of the total
authorization. Actual spending for these programs is highly variable and is driven
by program participation rates and prevailing economic and weather conditions.
Farm commodity program spending is anticipated to be higher in FY2006 due to
lower commodity prices, which result in higher counter-cyclical and loan deficiency
payments. The remaining 17% of the recommended appropriation is for
discretionary programs. This is the category of spending over which appropriators
have direct control.
As in past years, in order to meet the FY2006 allocations for discretionary
programs, yet meet requests for biosecurity, pay costs, and other programs,
appropriators placed limitations on authorized levels of spending in the 2002 farm
bill for various mandatory conservation, rural development, and research programs.
In total, appropriators recommended reducing authorized FY2006 spending levels for
these programs by $1.4 billion in the House bill and $1.3 billion in the Senate bill
(compared with $1.3 billion in FY2005), and applied those savings toward meeting
the discretionary allocation. For more details, see Table 3 in the conservation section
and Table 4 in the rural development section of this report.
The Senate adopted two amendments during floor debate that affect the bill
generally. The first is an amendment by Senator Coburn, adopted 55-39, requiring
that any “limitation, directive, or earmarking” in the House or Senate committee
reports be restated in the conference report in order to be considered approved by
both chambers. The intent is to improve the transparency of earmarks in the final
bill. A similar amendment was rejected in June during debate on the Interior-
Environment appropriations bill. However, following adoption in the agriculture bill,
the amendment was adopted the next day in the Military Construction-Veterans
Administration appropriations bill.
The second is a sense of the Senate amendment by Senator McCain, adopted by
voice vote, that would encourage funding for earmarks to be redirected to Hurricane
Katrina recovery efforts if such earmarks are determined not to be “of national
significance or in the public interest” by agency or department heads in consultation
1 All FY2005 figures cited in this report (including the table at the end) reflect the 0.8%
across-the-board rescission to all discretionary accounts as required in the FY2005 omnibus
measure (P.L. 108-447).

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CRS-6
with Congress. A similar amendment was adopted in the Commerce-Justice-Science
appropriations bill a week earlier.
Neither the House nor Senate version of the agriculture appropriations bill
contains any specific funding for hurricane relief. The bill’s Senate sponsors said
that the regular appropriation for USDA allows the Department to respond to
disasters, and that any additional funds should be appropriated through a dedicated
emergency supplemental bill.
Among the primary differences for conferees to resolve are the $514 million
difference between the total amounts in House and Senate versions, and two House
amendments that would delay country of origin labeling for meat products and allow
prescription drug reimportation.
Appropriations Separate From Budget Reconciliation. On April 28,
2005, the House and Senate passed the conference agreement on the FY2006 budget
(H.Con.Res. 95, H.Rept. 109-62). In addition to the discretionary budget allocations,
the budget agreement also provides reconciliation instructions that the agriculture
authorizing committees find program changes to save $173 million in FY2006 and
$3.0 billion over FY2006-FY2010. Further action depends on how the House and
Senate agriculture committees (not the appropriations subcommittees) carry out the
instructions.
The original September 15, 2005, deadline for authorizing committees to report
legislation to the Budget committee was postponed a month following the response
to Hurricane Katrina. The new deadline for the complete reconciliation package is
October 24 in the House and October 26 in the Senate. Authorizing committees are
expected to complete their marks about a week earlier. Neither the House nor Senate
Agriculture committees have indicated how they plan to achieve the necessary
savings. For more information on budget reconciliation for agriculture, see CRS
Report RS22086, Agriculture and FY2006 Budget Reconciliation, and CRS Report
RS21999, Farm Commodity Policy: Programs and Issues for Congress.
The following sections of this report review the major recommendations in the
Senate-passed and House-passed version of the FY2005 agriculture appropriations
measure, and compare them with the Administration’s request and the enacted
FY2005 appropriations levels. As the appropriations process continues in Congress,
this report will be updated to compare the measures. Also, see Table 7 at the end of
this report for a tabular summary.
USDA Agencies and Programs
The appropriations bill for agriculture and related agencies covers all of USDA
except for the Forest Service, which is funded through the Interior appropriations bill.

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Commodity Credit Corporation
Most spending for USDA’s mandatory agriculture and conservation programs
was authorized by the 2002 farm bill (P.L. 107-171), and is funded through USDA’s
Commodity Credit Corporation (CCC). The CCC is a wholly owned government
corporation. It has the legal authority to borrow up to $30 billion at any one time
from the U.S. Treasury. These borrowed funds are used to finance spending for
ongoing programs such as farm commodity price and income support activities and
various conservation, trade, and rural development programs. The CCC also has been
the funding source for a large portion of emergency supplemental spending over the
years, particularly for ad hoc farm disaster payments, and direct market loss
payments to growers of various commodities which were provided in response to low
farm commodity prices.
The CCC eventually must repay the funds it borrows from the Treasury.
Because the CCC never earns more than it spends, its losses must be replenished
periodically through a congressional appropriation so that its $30 billion borrowing
authority (debt limit) is not depleted, which would render the corporation unable to
function. Congress generally provides this infusion through the regular annual
USDA appropriation law. Because of the degree of difficulty in estimating its
funding needs, which is complicated by crop and weather conditions and other
uncontrollable variables, the CCC in recent years has received a “current indefinite
appropriation,” which in effect allows the CCC to receive “such sums as are
necessary” during the fiscal year for previous years’ losses and current year’s losses.
Both the Senate-passed bill and the House-passed bill for FY2006 concur with
the Administration’s request for an FY2006 indefinite appropriation (“such sums as
necessary”) to the CCC, estimated at $25.690 billion. Although the recommended
FY2006 appropriation is about $9.2 billion above the estimated FY2005
appropriation of $16.452 billion, the increase is not because CCC spending is being
raised by Congress. Instead, it is tracking changes in the CCC’s net realized losses
expected to be incurred primarily in the preceding fiscal year (FY2005) under the
mandatory authorized provisions of the 2002 farm bill.
Furthermore, the estimated CCC appropriation for FY2006 is not a reflection
of expected outlays. USDA also has estimated the projected net outlays for FY2006,
but such spending initially will be funded through the borrowing authority of the
CCC, and ultimately reimbursed through a future appropriation after FY2006. For
FY2006, the Administration projects that CCC net outlays will be $19.805 billion,
compared with an estimated $24.065 billion in FY2005. Both years are up
considerably from preceding years such as FY2004 when CCC outlays were $10.574
billion.
Administration Legislative Proposals. The Administration’s FY2006
budget request also contains legislative proposals to reduce farm commodity
programs program spending that, if adopted by Congress, would save, according to
the Administration, $587 million in FY2006 and $3.4 billion over five years. The
Congressional Budget Office (CBO) has scored the Administration’s proposal much
differently: with a first-year cost of $266 million in FY2006, and a net reduction of
$6.9 billion over five years. The proposals include (1) a 5% across-the-board cut in

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CRS-8
all payments received by farmers under the commodity support programs; (2) a
tightening of payment limits for these programs from the current level of $360,000
per person to $250,000, making the use of commodity certificates and loan forfeiture
subject to the limits, and eliminating the three-entity rule that allows producers to
double the payment limits (CBO says the payment limits proposal was not specified
sufficiently to score); (3) a requirement that marketing loans be based on 85% of
historical crop production rather than 100% of current production; (4) an assessment
that would be paid by sugar processors on all marketed sugar; (5) greater flexibility
for USDA to adjust government purchase prices for surplus dairy products, in order
to minimize government costs of the dairy price support program; and (6) a two-year
extension of the MILC (Milk Income Loss Contract). H.Con.Res. 95 (H.Rept. 109-
62) includes budget reconciliation instructions that the agriculture authorizing
committees find program changes to save $173 million in FY2006 and $3.0 billion
over FY2006-10.
Neither the House nor Senate version of the appropriations bill addresses these
program changes. However, some legislation could be considered this year in the
context of the pending budget reconciliation bill. Further action depends on how the
House and Senate agriculture committees (not the appropriations subcommittees)
carry out the instructions. The original September 15, 2005, deadline for authorizing
committees to report legislation to the Budget committee was postponed a month
following the response to Hurricane Katrina. The new deadline for the complete
reconciliation package is October 24 in the House and October 26 in the Senate.
Authorizing committees are expected to complete their marks about a week earlier.
Neither the House nor Senate Agriculture committees have indicated how they plan
to achieve the necessary savings.
For more information, see CRS Report RS21999, Farm Commodity Policy:
Programs and Issues for Congress, and CRS Report RS22086, Agriculture and
FY2006 Budget Reconciliation.
Crop Insurance
The federal crop insurance program is administered by USDA’s Risk
Management Agency (RMA). It offers basically free catastrophic insurance to
producers who grow an insurable crop. Producers who opt for this coverage have the
opportunity to purchase additional insurance coverage at a subsidized rate. Policies
are sold and completely serviced through approved private insurance companies that
have their program losses reinsured by USDA. The annual agriculture appropriations
bill traditionally makes two separate appropriations for the federal crop insurance
program. It provides discretionary funding for the salaries and expenses of the RMA.
It also provides “such sums as are necessary” for the Federal Crop Insurance Fund,
which pays all other expenses of the program, including premium subsidies,
indemnity payments, and reimbursements to the private insurance companies.
Both the House-passed and Senate-passed versions of the FY2006 agriculture
appropriations bill (H.R. 2744) concur with the Administration request for such sums
as are necessary for the mandatory-funded Federal Crop Insurance Fund (Fund),
which the Administration estimates to be $3.159 billion for FY2006, compared with
$4.095 billion that was estimated for FY2005 at the time of enactment of the FY2005

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CRS-9
appropriations bill. Annual spending on the crop insurance program is difficult to
predict in advance and is dependent on weather and crop growing conditions and
farmer participation rates. Hence, both the FY2005 and FY2006 estimates for the
Fund are subject to significant revision over the course of the year.
For the discretionary component of the crop insurance program, the House-
passed version of H.R. 2744 provides $77.8 million for RMA salaries and expenses,
while the Senate-passed version contains $73.45 million for RMA. Both chambers
are above the enacted FY2005 level of $71.47 million, but below the
Administration’s FY2006 request of $87.8 million. Included in the House level is
$3.6 million requested by the Administration to support RMA’s ongoing efforts to
reduce waste and abuse within the crop insurance program. For the last several years,
mandatory funds from the Fund have been used for this purpose. However, the
legislative authority to tap these funds expires at the end of FY2005. As in the past
three years, most of the increase requested by the Administration is for various new
information technology (IT) initiatives. Over the past couple of years, appropriators
have not funded this request. Of the $12 million requested increase for various IT
initiatives, the House-passed bill provides $1.5 million, and the Senate-passed
version contains $1 million.
The House-passed bill also contains a general provision that prohibits RMA
from using any of its FY2006 funds to implement the premium discount plan (PDP).
The Senate-passed version is silent on this issue. The PDP allows crop insurance
companies that can demonstrate cost savings in their delivery of insurance to sell
policies to their customers at a discount. To date, the PDP has been approved for
only one company, which has reduced its costs by selling its policies directly to
customers online. Independent insurance agents, which sell crop insurance on behalf
of the crop insurance companies, are concerned that the PDP reduces their total
commissions and damages their profitability. Some farm groups contend that the plan
encourages cherry-picking of the best customers and might leave smaller farmers
uninsured.
Administration Legislative Proposals. The Administration’s FY2006
budget request also contains legislative proposals affecting the crop insurance
program that, if adopted by Congress, would save $140 million annually, beginning
in FY2007. These proposals include (1) a requirement that farmers purchase a crop
insurance policy as a prerequisite for receiving farm commodity income support
payments; (2) a two to five percentage point reduction in the portion of the crop
insurance premium that is paid by the government on behalf of a participating farmer,
with the largest percentage reductions made at the lower levels of insurance
coverage; (3) a requirement that producers pay 25% of the premium (up to $5,000)
for catastrophic (CAT) crop insurance coverage, instead of the current requirement
that a producer pay a $100 administrative fee and no premium; (4) a two percentage
point reduction in the reimbursement rate to private crop insurance companies for
their administrative and operating expenses. USDA contends that these proposals
would encourage farmers to buy-up to higher levels of crop insurance coverage, and
possibly preclude the need for ad hoc disaster payments, which have been made
available on a regular basis by Congress over the past 20 years. The Administration
and CBO estimate that these proposals would save more than $500 million over five
years.

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CRS-10
Neither the House- nor Senate-passed appropriations bill addresses these
modifications to the crop insurance program. However, some legislative revisions
to the program could be considered this year in the context of the pending budget
reconciliation bill. The House and Senate Agriculture Committees were required to
report reconciliation legislation to reduce spending by $3 billion over five years on
mandatory programs under their jurisdiction. Although it is unknown at this time
how these cuts will be made, changes to crop insurance could be part of the package.
The budget resolution required the Agriculture Committees (along with other
authorizing committees) to submit their legislative recommendations for spending
cuts to their respective Budget Committees by September 16, 2005. To date, no
action has been taken by the authorizing committees, since congressional attention
has been focused on hurricane relief and recovery activities. (For more on budget
reconciliation, see CRS Report RS22086, Agriculture and FY2006 Budget
Reconciliation.)
Farm Service Agency
While the Commodity Credit Corporation serves as the funding mechanism for
the farm income support and disaster assistance programs, the administration of these
and other farmer programs is charged to USDA’s Farm Service Agency (FSA). In
addition to the commodity support programs and most of the emergency assistance
provided in recent supplemental spending bills, FSA also administers USDA’s direct
and guaranteed farm loan programs, certain conservation programs and domestic and
international food assistance and international export credit programs.
FSA Salaries and Expenses. This account funds the expenses for program
administration and other functions assigned to the FSA. These funds include
transfers from CCC export credit guarantees, from P.L. 480 loans, and from the
various direct and guaranteed farm loan programs. All administrative funds used by
FSA are consolidated into one account. For FY2006, the Senate-passed bill
recommends a total appropriation of $1.358 billion for all FSA salaries and expenses,
which is $7.3 million below the Administration’s request, but $63 million above the
FY2005 appropriation. The House-passed bill recommends $1.326 billion, $32
million less than the Senate bill and $39 million below the Administration’s request.
Regarding closing and reorganizing county offices, the FY2006 House report
reiterates concern expressed in prior years’ appropriations reports instructing USDA
not to shut down or consolidate any FSA county offices unless rigorous analysis
proves such action to be cost-effective. The Senate adopted a floor amendment to
prevent office closures unless FSA both demonstrates how the closure would
improve cost-effectiveness and program delivery, and reports those findings to the
appropriations committees. The Senate’s action follows press reports weeks earlier
that USDA has plans to close several hundred county offices.
The National Agricultural Imagery Program (NAIP) would receive an increase
of $2.9 million under the House-passed bill, and an increase of $2 million under the
Senate-passed bill. The House report mentions a $15 million increase to maintain
staffing levels being funded in FY2005 by carryover balances from supplemental acts
to implement the farm bill. The Senate report recommends $3.3 million to hire
additional farm loan officers.

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CRS-11
FSA Farm Loan Programs. Through FSA farm loan programs, USDA
serves as a lender of last resort for family farmers unable to obtain credit from a
commercial lender. USDA provides direct farm loans and also guarantees the timely
repayment of principal and interest on qualified loans to farmers from commercial
lenders. FSA farm loans are used to finance the purchase of farm real estate, help
producers meet their operating expenses, and help farmers financially recover from
natural disasters. Some of the loans are made at a subsidized interest rate. An
appropriation is made to FSA each year to cover the federal cost of making direct and
guaranteed loans, referred to as a loan subsidy. Loan subsidy is directly related to
any interest rate subsidy provided by the government, as well as a projection of
anticipated loan losses caused by farmer non-repayment of the loans. The amount
of loans that can be made, the loan authority, is several times larger.
For FY2006, the Senate-passed bill recommends an appropriation of $150.8
million to subsidize the cost of making $3.743 billion in direct and guaranteed FSA
loans. This is $0.5 million less in loan subsidy (-0.3%) and $75 million less in loan
authority (-2%) than the House-passed bill, which recommends an appropriation of
$151.4 million to make $3.818 billion of loans.
The House-passed bill concurs with the Administration’s FY2006 request for
the main direct and guaranteed programs, but does not fund the Administration’s
request for $25 million in emergency loan authority ($2.7 million in loan subsidy),
nor does it grant the Administration’s request to reduce the boll weevil eradication
loan program by 40%. The Senate-passed bill generally follows the House bill, but
the Senate bill basically maintains farm ownership loans and farm operating loans
(both subsidized and unsubsidized) at FY2005 levels. Thus the Senate bill
recommends a higher amount for farm ownership and subsidized farm operating
loans compared to the House bill, and a lower amount for unsubsidized farm
operating loans.
Comparing both bills to the Administration’s request, the overall loan authority
can rise while the loan subsidy falls because both the House and Senate bills restore
the boll weevil account and deny the request for emergency loans. Comparing the
Administration’s request (and the concurring elements of the House bill) to FY2005
levels, the overall loan authority rises while the loan subsidy falls because the
guaranteed loan program grows and the direct loan program contracts. The Senate
bill does not redirect as much funding from direct to guaranteed loans.
Most of the House’s recommended rise in loan authority over FY2005 levels is
a $109 million increase in unsubsidized guaranteed farm ownership loans (an
increase of about 10%, to $1.2 billion in FY2006). These unsubsidized guaranteed
loans can be made with relatively little increase in appropriated funds compared to
changes in subsidized or direct loans.
The House bill concurs with the Administration proposal to reduce loan
authority for the direct farm ownership program by $8.3 million (-4%) and the
subsidized guaranteed operating loan program by $16.5 million (-6%). The Senate
bill does not follow this request. The Administration asserts that low interest rates
and the strong farm economy make this reduction possible. However, in recent years,

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CRS-12
the subsidized guaranteed operating loan program has not been able to meet demand,
and qualified farmers have been placed on waiting lists when funds are depleted.
For more information about agricultural credit in general, see CRS Report
RS21977, Agricultural Credit: Institutions and Issues.
Conservation
The Senate-passed bill provides more funds for discretionary programs ($964.0
million) than the House-passed bill ($939.8 million). Both bills provide less than the
FY2005 appropriation ($991.9 million) but more than the FY2006 request ($814.4
million). Both bills reject or limit many of the Administration’s proposed reductions
from FY2005 funding. Each bill provides some reductions to selected mandatory
programs, as shown below in Table 3. Even with the reductions in both bills,
mandatory funding would rise slightly from $3.897 billion in FY2005 if either of
them were enacted in their current form. The House bill identified many of the same
priorities as the Administration request, such as helping producers comply with
environmental regulations, while the Senate bill does not mention these priorities.
Discretionary Programs. For the discretionary programs, all administered
by the Natural Resources Conservation Service, the Senate-passed bill provides
$964.0 million, while the House-passed bill provides $939.8 million; both amounts
are substantially greater than the Administration’s request for $814.4 million. For
Conservation Operations (the largest discretionary program), the Senate bill provides
$819.5 million while the House provides $773.6 million. Both amounts are less than
the FY2005 estimate of $830.7 million, but more than the Administration request for
$767.8 million. The reduction requested by the Administration in its proposal was
based on a decision not to fund earmarks, which totaled more than $122 million in
FY2005 and would have saved an estimated $114.3 million in FY2006. However,
both bills reject this proposal and committee reports in both chambers identify
numerous earmarks. Both reports state that earmarks should be treated as additions
to allocations to states rather than as part of those allocations. The House bill also
requires the Chief of NRCS to report on all FY2005 and FY2006 Conservation
Operations allocations, by state, within 45 days of enactment. The House bill
provides an increase of $14.3 million to assist producers in meeting regulatory
requirements, which is about 38% of the Administration request for an additional
$37.5 million for this purpose, while the Senate bill does not specify this use of
funds. The amount in the House bill also reflects an amendment, adopted on the
floor, transferring $20 million from this account to the Small Dam Rehabilitation
Program.
Among the other discretionary programs, both bills provides $60 million for
Watershed and Flood Prevention Operations (a reduction from $15.0 million in
FY2005, but $60 million more than the Administration had requested). The bills
differ for each of the other programs. The Senate provides $27.3 million for the
Watershed Rehabilitation Program (nearly identical to FY2005), while the House
provides (after a floor amendment was adopted) $47.0 million; the Administration
had requested $15.1 million. For the Watershed Surveys and Planning Program, the
Senate provides $5.1 million (the same amount as the Administration requested),
while the House provides $7.0 million (the same amount that was provided in

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CRS-13
FY2005). Both bills provide almost level funding from FY2005 for the Resource
Conservation and Development Program (RC&D) ($51.2 million in the Senate and
$51.4 million in the House); these amounts are substantially more than the
Administration request of $25.6 million. In addition, the Senate bill would fund an
additional program for the first time by providing $5 million to implement the Heathy
Forest Reserve.
In one major change from the Administration’s request, both bills include
numerous priority projects using funds from the Watershed and Flood Prevention
Operations account, but do not earmark specific amounts. The Administration had
asserted that elimination of Watershed and Flood Prevention Operations would allow
resources to be redirected to other priority “regulatory challenges.” In a second major
change from the request, both bills reject the Administration’s proposed reduction to
the RC&D account that would have been based on a change in policy to phase out
federal support to participating councils after they had received federal funds for 20
years. Of the 375 participating councils, 189 (50%) would lose funding under this
proposal. The House committee report states that changes in funding policy for this
program should be based on “effectiveness and performance” rather than of the age
of councils, and directs NRCS to develop ways to measure the effectiveness of
councils. Finally, no funding was sought or is being provided for the two emergency
conservation programs. Typically, those programs are funded in supplemental
appropriations legislation in response to specific natural disasters.
Mandatory Programs. Funding for the suite of mandatory conservation
programs administered by NRCS would increase slightly over FY2005. However,
both bills also limit funding for some of these programs to levels below the
authorized amounts; these programs and levels are listed in Table 3. During full
House consideration of the bill, an amendment was adopted that shifted funds among
the mandatory conservation accounts, but did not change the overall funding level for
this group of programs.
Neither bill places funding or enrollment limits on the Conservation Reserve
Program, which is the only mandatory conservation program not administered by
NRCS (it is administered by the Farm Service Agency). This action concurs with the
Administration request, and, as a result, program spending is estimated to increase
by $79 million to $2.021 billion in FY2006.
All the mandatory programs have authorized dollar or acreage limits either
annually or for the life of the authorization, so changes in funding should be
compared with these limits, which change from year to year, as well as with funding
the preceding year. The largest reductions from FY2005 include the Grasslands
Reserve Program (the reduction from $128 million to $0 in the Administration
proposal and both bills reflects the allocation of the entire $254 million authorized
in the FY2002 farm bill by the end of FY2005) and the Farm and Ranch Lands
Protection Program, reduced by $36 million in the House bill (to $74 million).
When compared to authorized levels, the largest reduction in mandatory
programs is the Environmental Quality Incentives Program, authorized at $1.2 billion
but receiving $1.017 billion in FY2005, which would receive the same funding in
FY2006 in the Senate bill and $1.052 billion in the House bill. When other proposed

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CRS-14
reductions are viewed this way, the Farm and Ranch Lands Protection Program
received $13 million less than its authorized level of $125 million in FY2005 and
would receive $36 million less than its FY2006 authorized level of $100 million,
while the Wetland Reserve would be limited to enrolling about 100,000 acres less
than the 250,000 authorized under both bills as well as the Administration request.
Among the largest increases from FY2005 are the Conservation Reserve
Program (up $79 million) and the Conservation Security Program (up $129 million
to $331 million in the Senate bill, up $43 million to $245 million in the House bill
and up $72 million to $274 million in the Administration request). While the
Conservation Security Program would increase under the request, CBO estimated in
its January 2005 baseline that it would grow by $254 million in FY2006, rather than
the $72 million in the Administration’s request.
Table 3. Changes in Mandatory Conservation Programs
FY2005
FY2006
FY2006
FY2006
Enacted
Authorization
House bill:
Senate bill:
Program
(P.L. 108-447):
under 2002
Allowed
Allowed
Allowed Level
Farm Bill*
Level
Level
Environmental
$1.017 billion $1.200 billion $1.052 billion $1.017 billion
Quality Incentives
Program
Conservation
$202.4 million
$331 million
$245 million
$331 million
Security Program
Wildlife Habitat
$47 million
$85 million
$43 million
$47 million
Incentives Program
Wetlands Reserve
154,500 acres
250,000 acres
154,500 acres
150,000 acres
Program
Farm and Ranch
$112 million
$100 million
$73.5 million
$100 million
Lands Protection
Program
Ground and Surface
$51 million
$60 million
$51 million
$51 million
Water
Small Watershed
$0
$210 million
$0
$0
Rehab. Program
Ag. Management
$0
$20 million
$6 million**
$20 million
Assistance
* Figures in the FY2006 authorized column represent how much would be available under current law,
including the carryover of unobligated balances from prior years, had no restrictions been placed.
** Under this program, $14 million of the total goes to NRCS, and that would not be funded; the
remaining $6 million, which goes to RMA and AMS, would be fully funded.

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Agricultural Trade and Food Aid
The House-passed bill provides $1.441 billion in budget authority for
discretionary international activities which include primarily foreign food aid
programs under the Agricultural Trade Development and Assistance Act of 1954
(P.L. 83-480) and the salaries and expenses of the Foreign Agricultural Service. The
Senate-passed bill contains budget authority of $1.488 billion, with most of the
difference accounted for by the Senate’s larger appropriation for P.L. 480 food aid.
Both measures reject the President’s proposal to purchase commodities in
markets near to countries in need rather than from U.S. producers by shifting funds
from P.L. 480 to a U.S. Agency for International Development (USAID) disaster and
famine assistance fund. Despite some expectations to the contrary, there were no
Senate amendments that would have provided some or all of the $300 million
requested by the President for purchase of non-U.S. commodities for famine relief
(see below).
USDA’s international activities also include those funded through the borrowing
authority of the Commodity Credit Corporation (CCC). Included in this category are
some additional food aid programs, export credit guarantees, market development
programs, and export subsidies. USDA estimates that the total program value of
discretionary and CCC-funded international activities for FY2006 would be more
than $6 billion.
Foreign Agricultural Service (FAS). The House bill recommends an
appropriation of $148.2 million for the Foreign Agricultural Service (FAS) which
administers USDA’s international programs with the exception of P.L. 480 Title II
commodity donations, which are administered by USAID. The Senate committee
measure provides for $147.9 million. These amounts are about $11 million more
than enacted in FY2005, but close to the President’s budget recommendation.
Foreign Food Assistance. For P.L. 480 foreign food assistance, the House
bill recommends budget authority of $1.187 billion. The recommended budget
authority includes $77 million for P.L. 480 Title I (long-term, low-interest loans to
food deficit countries for the purchase of U.S. food commodities) and $1.107 billion
for P.L. 480 Title II (humanitarian donations for emergency relief and non-emergency
development projects). The P.L. 480 Title II request is $222.1 million more than
requested in the President’s budget. The Senate-passed measure also provides $77
million for P.L. 480 Title I and, for Title II, $1.159 billion, which is $274 million
more than the President requested.
The President’s budget contained a proposal to shift about $300 million from
P.L. 480 Title II to USAID’s International Disaster and Famine Assistance account,
which would be administered separately from Title II and used to purchase food for
emergency relief in markets closer to their final destinations rather than in the United
States as required under P.L. 480. This proposal, effectively rejected by both
measures, proved controversial with farm groups, agribusinesses and the maritime
industry who supply and ship commodities for Title II and with private voluntary
organizations who rely on food aid to carry out development projects in poor
countries. During House committee deliberations, amendments offered by

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CRS-16
Representative Jesse Jackson Jr., to augment P.L. 480 Title II emergency food aid
by $393 million and $78 million, respectively, were defeated.
For the McGovern-Dole International Food for Education and Child Nutrition
Program, the House bill and the Senate-passed measure both include an appropriation
of $100 million. The McGovern-Dole program provides U.S. commodities, funds,
and technical assistance to school feeding and child nutrition activities carried out by
U.S. private voluntary organizations and the United Nations World Food Program
(WFP) in poor countries. This level of budget authority is $13.2 million more than
appropriated in FY2005.
Other food aid activities, largely funded by CCC-borrowing, include the Food
for Progress Program (FFP), Section 416(b) commodity donations, and the Bill
Emerson Humanitarian Trust (BEHT). The President’s budget estimates that $137
million of CCC funds would go to the Food for Progress (FFP) program, which
provides food aid to developing countries and emerging democracies that are
introducing and expanding free enterprise in their agricultural economies. Additional
FFP monies would be available from the funds appropriated to P.L. 480 Title I. The
budget anticipates that $151 million of CCC-owned nonfat dry milk, about 75,000
metric tons, would be available for food aid programming under Section 416(b) of
the Agricultural Act of 1949. Section 725 of Title VII (General Provisions) in the
House bill directs the Secretary of Agriculture to make available, “to the extent
practicable,” $25 million of commodities provided under Section 416(b) to assist in
mitigating the effects of HIV AIDS. No program level is indicated in the President’s
budget for the BEHT, a reserve of commodities and cash that can be tapped in the
event of unanticipated need for emergency food aid. The BEHT currently holds 1.4
million metric tons of wheat and $107 million in cash. Section 738 of Title VII
(General Provisions) of the House bill limits to $20 million the amount of FY2005
P.L. 480 appropriations that may be used to reimburse the CCC for the release of
commodities from the BEHT.
U.S. food aid programs are under discussion in the Doha Round of multilateral
trade negotiations, being carried out under the auspices of the World Trade
Organization (WTO). Negotiations could result in food aid programs being subject
to more stringent regulations as WTO member countries have agreed to eliminate
food aid that displaces commercial sales. Furthermore, negotiators are examining the
question of providing food aid fully in grant form as well as the role of international
organizations vis-a-vis WTO member countries’ bilateral food aid programs. U.S.
negotiators have endorsed the concept that food aid should not displace commercial
sales, but are aggressively defending U.S. bilateral, in-kind food aid programs as
needed to enhance food security in poor, developing countries.
Export Credit Guarantees. CCC Export Credit Guarantee Programs
guarantee payment of commercial financing of U.S. agricultural export sales. The
President’s budget estimates a program level for export credit guarantees of $4.4
billion, none of which would receive a discretionary appropriation. Most guarantees
— $3.4 billion — are for commercial credits with short-term repayment terms (up
to three years). Another $1 billion would be guarantees for supplier credits where
short-term financing is extended directly to importers for the purchase of U.S.

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agricultural products. The CCC repays commercial lenders when foreign borrowers
default on loans.
Export credit guarantees are also on the agenda of the current Doha Round of
multilateral trade negotiations. The United States has agreed to eliminate trade-
distorting aspects of such programs in exchange for the elimination of all agricultural
export subsidies by the European Union. In addition, an appeals panel in the recently
decided U.S.-Brazil cotton dispute ruled that U.S. export credit guarantees are
effectively export subsidies, making them subject to previously notified export
subsidy reduction commitments. To bring its export credit guarantee programs into
conformity with the WTO ruling, USDA has announced changes in the program to
make it more risk-based. USDA also announced the termination of intermediate
credit guarantees (three to seven years).
Export Promotion and Export Subsidies. USDA’s export promotion
programs include the Market Access Program (MAP), which primarily promotes
sales of high value products, and the Foreign Market Development Program (FMDP),
which mainly promotes bulk commodities. The President’s budget provides CCC
funding of $125 million for MAP, $15 million less than the FY2005 level and $75
million less than authorized in the 2002 farm bill. A Chabot amendment to prohibit
funds from being used to carry out MAP activities failed by a recorded vote of 66 to
356. For FMDP, the budget allocates $34.5 million, the same as in FY2005; the
Senate bill’s report (S.Rept. 109-92) instructs FAS to fund FMDP at no less than the
FY2005 level.
For export subsidy programs, the budget allocates $28 million to the Export
Enhancement Program (EEP) and $52 million to the Dairy Export Incentive Program
(DEIP). EEP has been little used in recent years and, in FY2005, EEP subsidies were
zero. DEIP subsidies would exceed their FY2005 level by $46 million. The
President’s request also includes $90 million for Trade Adjustment Assistance to
Farmers, the maximum amount allowed in the authorizing statute, the 2002 Trade
Act. Under this program, USDA makes payments to farmers when the current year’s
price of an agricultural commodity is less than 80 percent of the five-year national
average and imports have contributed importantly to the decline in price.
(For additional information, see CRS Issue Brief IB98006, Agricultural Export
and Food Aid Programs, updated regularly. For information on WTO negotiations
on agricultural export subsidies, export credit guarantees, and food aid, see CRS
Report RS21905, Agriculture in the WTO Doha Round: The Framework Agreement
and Next Steps.)
Agricultural Research, Extension, and Economics
Four agencies carry out USDA’s research, education, and economics (REE)
function. The Department’s intramural science agency is the Agricultural Research
Service (ARS), which performs research in support of USDA’s action and regulatory
agencies, and conducts long term, high risk, basic and applied research on subjects
of national and regional importance. The Cooperative State Research, Education,
and Extension Service (CSREES) is the agency through which USDA distributes
federal funds to the land grant Colleges of Agriculture to provide partial support for

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state-level research, education and extension programs. The Economic Research
Service (ERS) provides economic analysis of agriculture issues using its databases
as well as data collected by the National Agricultural Statistics Service (NASS).
The USDA research, education, and extension budget, when adjusted for
inflation, remained essentially flat in the period from FY1972 through FY1991.
From FY1992 through FY2000, the mission area experienced a 25% increase (in
deflated dollars) over the previous two decades. Annual increases have since
moderated, and supplemental funds appropriated specifically for anti-terrorism
activities, not basic programs, accounted for most of the 10% increase in FY2001.
Although the states are required to provide 100% matching funds for federal funds
for research and extension, most states have regularly appropriated two to three times
that amount. Fluctuations in state-level appropriations can have significant effects
on state program levels, even when federal funding remains stable. Cuts at either the
state or federal level can result in program cuts felt as far down as the county level.
In 1998 and 2002 legislation authorizing agricultural research programs, the
House and Senate Agriculture Committees tapped sources of available funds from
the mandatory side of USDA’s budget and elsewhere (e.g., the U.S. Treasury) to find
new money to boost the availability of competitive grants in the REE mission area.
From FY1999 through FY2003, however, annual agriculture appropriations acts
prohibited the use of those mandatory funds for the purposes the Agriculture
Committees intended. Instead, from FY1999 through FY2002, and in FY2004 and
FY2005, appropriations conferees provided more funding for ongoing REE programs
than was contained in either the House- or Senate-passed versions of the bills.
Nonetheless, once adjusted for inflation, these increases do not translate into
significant growth in spending for agricultural research. Agricultural scientists,
stakeholders, and partners express concern for funding over the long term in light of
high budget deficit levels and lower tax revenues.
The Senate-passed version of H.R. 2744 contains a total of $2.67 billion for
USDA’s research, extension, and economics mission area for FY2006. This amount
is $200 million higher than the House-passed version of the bill, and almost level
with the current fiscal year appropriation of $2.65 billion.
Agricultural Research Service. The Senate-passed measure provides $1.27
billion in total for ARS ($1.29 billion in FY2005), compared to $1.12 billion
provided in the House-passed version. Of the $1.27 billion, $1.1 billion would
support ARS’s research programs (the House allowance is $1.0 billion). As in past
years, Senate appropriators concurred with the House in rejecting the
Administration’s proposal to terminate a large number of earmarked ARS research
projects. The Senate measure contains $160.6 million to support the modernization
and construction of ARS laboratory facilities (compared to $87.3 million in the
House-passed measure). In FY2005, $186.3 million is available for facility
construction.
The $160.6 million for ARS facility construction in the Senate-passed version
would cover 21 building projects, compared to eight in the House-passed version.
Both measures would provide the full funding that the Administration proposed

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($58.8 million) for continued construction of the National Centers for Animal Health
(formerly known as the National Animal Disease Center) in Ames, Iowa.
Cooperative State Research, Education, and Extension Service. The
Senate-passed measure contains $1.17 billion total in FY2006 for CSREES,
compared to $1.13 billion in the House-passed version. The current appropriation
is $1.16 billion. Of the $1.17 billion total, the Senate would allocate $652.2 million
to support state-level research and academic programs ($662.5 million in the House
version, and $655.5 million in FY2005); $453.4 million for Extension programs
($444.9 million in the House version and $445.6 million in FY2005); and $55.8
million for integrated programs that have both research and extension components
($15.5 million in the House measure, and $55 million in FY2005).
Senate appropriators concurred with the House in rejecting the Administration
proposal to cut formula funds for the state agricultural experiment stations (under the
Hatch Act) by 50% and to provide a new pool of $75 million for distribution through
competitively awarded grants, plus an additional $70 million ($250 million total) for
the National Research Initiative (NRI), the primary existing competitive grants
program in agriculture. Experiment station directors traditionally have used formula
funds (a form of block grant), which are relatively stable from year to year, to support
the core, ongoing agricultural research programs in each state. Both the Senate and
the House also turned back an Administration proposal to shift half of the formula
funds for cooperative forestry research to competitive grants, and to eliminate
formula funds to states for animal health and disease research, also with the aim of
supporting such research in the future with competitive grants.
Viewed as a whole, the Administration proposal reflected a policy change that
has been under discussion among agricultural scientists, administrators, and
policymakers for quite some time. In a 1989 report, and subsequent reports, the
National Academy of Science has recommended that a greater proportion of USDA
research money be distributed competitively rather than by formula or by direct
appropriation (as ARS is funded). The House and Senate Agriculture Committees
have raised authorized funding levels for competitive grants in past farm bills and
other related legislation, and tapped new sources of mandatory money for
competitive grants. These changes would allow the funds allocated to competitive
grants to grow in relation to direct appropriations for research. The FY2006 budget
request marks the first time that an Administration has directly proposed a budget
reflecting a shift in funding mechanisms toward more competitive grants.
Historically, however, annual appropriation acts have maintained the customary
proportion between competitive and non-competitive mechanisms for distributing
federal agricultural research dollars (roughly 10/90).
Both the Senate- and the House-passed bills maintain level funding with
FY2005 for Hatch Act formula funds ($178.7 million), and level funding for forestry
and animal health research ($22.2 million and $5.06 million, respectively, in
FY2005). The Senate bill contains $190 million for the NRI competitive grants
program, and the House measure contains $214.6 million. Senate appropriators, like
their House counterparts, also rejected the Administration’s request to significantly
scale back special (earmarked) research and extension projects. The Senate bill

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contains $171 million in earmarked project funds, and the House would provide
$147.8 million ($167.7 million in FY2005).
The Senate-passed funding bill agrees with the House in providing a $1 million
increase above FY2005 in funding for research at the 1890, historically black, land
grant Colleges of Agriculture ($37.7 million); level funding ($12.3 million) for 1890s
research capacity building; roughly an $800,000 increase in funds for 1890 extension
programs ($33.6 million in the Senate measure, $33.9 million in the House); and
level funding ($17 million) for grants to improve extension facilities at 1890 schools.
Both measures would provide $12 million for the endowment fund for Native
American post-secondary institutions, as in FY2005, and they are very close in their
allocations for research and extension at the tribal institutions ($1.1 million and $3.2
million, respectively in the Senate bill; and $1 million and $3.3 million, respectively,
in the House bill). Both measures would provide level funding ($276 million) for
formula-funded extension programs at the 1862 land grant universities.
CSREES administers two competitive grant programs that are authorized to be
funded by mandatory transfers of unobligated government funds. The largest of these
is the Initiative for Future Agriculture and Food Systems (IFAFS), which is
authorized to receive $160 million in FY2006. Starting in FY2002, annual
appropriations acts have blocked CSREES from operating the IFAFS program. In
FY2004 and FY2005, appropriations conference report language allowed the
Secretary to award up to 20% of the appropriation for the NRI competitive grants
program using IFAFS program criteria (approximately $35 million in FY2005; $30
million in FY2004). Both measures block IFAFS funding except to administer and
oversee previously awarded grants (section 719), and would continue the practice of
allocating a percentage of NRI competitive grant funds for IFAFS purposes (20% in
the Senate version, 22% in the House). The goal of both IFAFS and the NRI is to
support fundamental research on subjects of national, regional, or multistate
importance to agriculture, natural resources, human nutrition, and food safety, among
other things.
The second CSREES grant program authorized to use mandatory funds supports
research and extension programs on organic agriculture. The 2002 farm act
authorizes $3 million annually through FY2007 for this program. Neither the Senate
nor the House measure contains language that would change program funding in
FY2006.
Economic Research Service (ERS) and National Agricultural
Statistics Service (NASS). The Senate-passed version of H.R. 2744 provides
$78.5 million for USDA’s Economic Research Service. This amount is slightly
higher than the House-passed bill ($75.9 million), slightly less than the
Administration’s request ($80.7 million), and $4.3 million more than the current
fiscal year appropriation ($74.2 million). Committee language requires ERS to
continue the initiative to gather production and market data for the organic
agriculture industry, and requests the agency to study the economic effects of
agricultural cooperatives on rural communities and residents.
Senate appropriators provide $145.2 million for the National Agricultural
Statistics Service, an amount almost $17 million higher than FY2005 funding, $7

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million more than contained in the House-passed version, and level with the
Administration’s request.
Meat and Poultry Inspection
USDA’s Food Safety and Inspection Service (FSIS) conducts mandatory
inspection of meat, poultry, and processed egg products to insure their safety and
proper labeling. The House-passed bill appropriates $837.3 million for FSIS in
FY2006, below the President’s request for $849.7 million for FSIS but $20.1 million
above the FY2005 enacted level of $817.2 million. The Senate bill provides $836.8
million. The President’s budget proposed that new user fees cover $139 million of
the $849.7 million FSIS request. However, neither the House nor Senate version
endorses such fees.
When it released its FY2006 budget proposal, the Administration said that it
would offer draft legislation to collect the fees to cover inspection costs beyond a
plant’s single primary approved shift. The Administration has included the expanded
user fee proposal in the past three years’ budget requests, and previous
administrations have proposed that more inspection activities be funded through user
fees. Administration officials have asserted that the fees are needed to achieve
budgetary savings without compromising food safety oversight, and that producer
and consumer price impacts would be “significantly less than one cent per pound of
meat, poultry, and egg products.” Congress has never agreed with these proposals,
responding that assuring the safety of the food supply is an appropriate function of
taxpayer-funded federal government. The appropriations committees also have
reminded the Administration that user fee proposals are within the purview of the
authorizing committees, not theirs. FSIS has been authorized since 1919 to charge
user fees for holiday and overtime inspections. Income from existing user fees (plus
trust funds) will add approximately $123 million to the FSIS program level (beyond
appropriated levels) in FY2006, according to USDA.
Within the House-passed bill’s $837.3 million for FSIS is an increase of $6.7
million for food defense activities, including $2.8 million for agency participation in
the Food Emergency Response Network, $2.5 million to upgrade laboratory
capabilities to evaluate a broader range of threat agents, $1 million for related
training, and $417,000 for biosurveillance, according to the House report. Also
within the total is an increase of $2.2 million to enable FSIS to hire 22 additional
Consumer Safety Inspectors to help free veterinary-trained inspectors for more
critical food safety responsibilities, as proposed by the Administration. The House
report requests periodic updates on the performance of the initiative, including its
effect on public health.
Within the Senate-passed bill’s FSIS appropriation are the following increases
for activities related to food defense: $209,000 for biosurveillance, $1.25 million for
enhanced laboratory capabilities, and $504,000 for biosecurity training. The Senate
committee report directs that no less than $2 million be used for baseline
microbiological studies of raw meats and poultry, targeting the prevalence of
pathogens and microorganisms as indicators of process control. The Senate total also
includes an increase of more than $2.2 million for front-line inspection costs, and
provides $5 million (available through the end of FY2007) for FSIS to complete

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incorporation of the Humane Activities Tracking system into all U.S. slaughter
plants. The Senate committee report states that its appropriation provides the
requested amount to maintain the 63 positions related to enforcement of the Humane
Methods of Slaughter Act. Both the Senate and House bill language designates,
within the FSIS total, $20.7 million for regulatory and scientific training.
“Downer” Amendment. During floor consideration of H.R. 2744 on
September 20, 2005, the Senate adopted by voice vote an amendment offered by
Senator Akaka that would prohibit nonambulatory livestock (also called “downers”)
from being used for human food. The House bill lacks such a ban. Supporters of the
Senate amendment have argued that downer animals pose numerous food safety
hazards, including bovine spongiform encephalopathy (BSE or “mad cow disease”)
and its human variant, and microbial hazards such as Salmonella. They have noted
that some prominent fast-food chains already ban the use of these animals for the
meat they accept. Opponents of the ban have expressed concern about the integrity
of BSE surveillance if these animals are no longer brought to slaughter, and have
questioned the scientific basis of the ban, in light of its economic impacts.
The Akaka amendment would apply not only to cattle, but also to any sheep,
swine, goats, horses, mules or other equines “that are unable to stand or walk
unassisted” at the point of antemortem inspection. A regulatory prohibition on the
slaughter of downer cattle for human food is already in effect; it is one of several
meat inspection changes USDA instituted in January 2004 in response to the
discovery of BSE in the United States the previous month. Some within the industry
have argued that USDA’s downer ban should distinguish between animals that
cannot walk because of BSE or another potentially dangerous disease, and those that
are essentially lame (and, presumably, safe for use as food).
Prior to the emergence of BSE in North America, downer cattle were linked
more closely with the issue of humane slaughter. Widespread media reports in the
1990s made claims that nonambulatory cattle were suffering in transport to and after
arrival at slaughter plants. Some in Congress believed (and continue to argue) that
a ban on their inspection (effectively reducing any higher value as human food)
would serve to improve their treatment.
Horse Slaughter Amendment. Both the House and Senate-passed versions
prohibit funds to pay for the inspection of horses destined for human food
consumption. The prohibitions were added during floor consideration: in the House
on June 8, 2005, by a 269 to 158 vote to pass the Sweeney amendment, and in the
Senate on September 20, 2005, by a 69 to 28 vote to pass the Ensign amendment.
Currently, three foreign-owned plants in two states (Texas and Illinois) slaughter
a total of approximately 66,000 horses annually for human food. The meat is
exported primarily for consumption in parts of Europe and in Japan. Because the
Federal Meat Inspection Act requires FSIS inspection of equines (like other
designated livestock species) before their meat may enter commerce, the presumption
is that these plants could no longer process them for human food if and when H.R.
2744 with this provision is signed into law. It was unclear, immediately following
the Senate action, whether it would be feasible, and legal, for the plants to operate
under some other arrangement, such as requesting voluntary FSIS inspection, which

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is conducted under the Agricultural Marketing Act of 1946 and underwritten by
industry user fees. (For more information, see CRS Report RS21842, Horse
Slaughter Prevention Bills and Issues.)
Marketing and Regulatory Programs
Animal and Plant Health Inspection Service (APHIS). The largest
appropriation for USDA marketing and regulatory programs goes to APHIS, the
agency responsible for protecting U.S. agriculture from domestic and foreign pests
and diseases, responding to domestic animal and plant health problems, and
facilitating agricultural trade through science-based standards. The House provides
a total of $847.5 million for APHIS in FY2006, below the Administration’s FY2006
request of $860.2 million, and above the FY2005 enacted level of $813 million. The
Senate provides $812.8 million, slightly below the FY2005 level.
Within APHIS activities related to protecting U.S. food and agriculture from
both intentional and unintentional threats, the Senate appropriation generally (but not
completely) tracks the amounts for individual programs that were provided for
FY2005 — rather than the increases (and for a few programs, the decreases)
recommended by the Administration for FY2006.
More specifically, the Senate version reduces funding for boll weevil
management from $45.6 million in FY2005 to $39.9 million in FY2006. However,
the Administration had requested just $14.3 million for the boll weevil program, and
the House version contains $38.6 million. For Johne’s disease, the Senate-passed
measure includes $18.6 million in FY2006, nearly identical to the FY2005 level but
well above the Administration’s FY2006 request of $3.2 million. The House-passed
bill contains $7.8 million for Johne’s disease in FY2006.
The House-passed measure at least partially funds a variety of APHIS increases
in pest and disease activities that were requested by the Administration, including
expanded funding for plant pest detection, and for animal health threat monitoring,
surveillance, and response activities. These and other “food defense” increases
would be partly offset by proposed reductions in several more traditional APHIS pest
and disease programs (see above).
House floor debate on the measure reflected several Members’ concerns
regarding the adequacy of funding to address a number of emerging plant pests. The
House Appropriations Committee had budgeted approximately $100.1 million for
APHIS’s emerging plant pests program. However, several Members argued that
more was needed to deal with such growing problems as the emerald ash borer in
Michigan, Ohio, and Indiana; the Asian long-horned beetle in states like New York
and New Jersey; and sudden oak death in the West and elsewhere. Approved, 226
to 201, was a floor amendment by Representative Weiner to add $18.9 million to
APHIS’s emerging plant pest program budget in FY2006. To offset this increase, the
amendment reduces spending for USDA’s Common Computing Environment by $21
million.
The House also approved by voice vote another floor amendment, by
Representative Schwarz, expressing the sense of Congress that USDA should use its

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standing authority under the Plant Protection Act (7 U.S.C. 7772) to transfer funds
from the Commodity Credit Corporation (CCC) to implement APHIS’s strategic plan
for eradicating the emerald ash borer. Although transfers from the CCC to APHIS
to deal with pests and diseases have been common, particularly in recent fiscal years,
the Office of Management and Budget (OMB) reportedly has shown increasing
reluctance to approve them. The Senate Appropriations Committee’s report also
encourages the Secretary to continue using CCC funds to respond to plant and animal
health threats, including the payment of compensation to certain producers for related
losses when necessary. (See CRS Report RL32504, Funding Plant and Animal
Health Emergencies: Transfers from the Commodity Credit Corporation.)
Neither the House nor Senate bill includes the Administration’s proposal for
new user fees for animal welfare inspection, totaling nearly $11 million in FY2006,
to replace an equivalent amount of appropriated funds. The Administration’s
proposal appears to be similar to past proposals offered in FY2003, FY2004, and
FY2005, to apply such user fees directly to APHIS accounts (rather than to Treasury).
Congress has not acted on the requests in the past.
BSE. Most of USDA’s BSE-directed funding is through APHIS, one of several
USDA and non-USDA agencies involved in protecting the U.S. cattle herd and
consumers from the introduction or spread of the disease.
According to the House report, $17.2 million is being provided for APHIS’s
BSE activities (primarily testing and surveillance), the full amount requested. The
Senate report also notes that $17.2 million is being provided to continue BSE
surveillance, plus another $1 million for the Comprehensive Surveillance Program.
The agency had said it expected to test 40,000 animals for BSE during FY2006,
although the report in June 2005 of a U.S.-born cow with BSE — which had been
declared negative for the disease seven months earlier — may have created
uncertainty about next year’s surveillance plans. Under a special 12-18-month BSE
surveillance program launched in June 2004, APHIS has tested 472,000 cattle
(through mid-September 2005). This special program was due to end in FY2005.
(Other agencies within the Department are earmarking additional funds for BSE-
related research, such as on improved diagnostic tests for prions in animal tissue and
feeds; on transmissibility of prions among livestock and wildlife species; on
differentiating BSE strains; and on determination of the pathobiology of disease
infection.)
Both the House-passed and Senate-passed bills also designate approximately
$33 million of the APHIS appropriation for the agency’s continued development of
a National Animal Identification System (NAIS), as requested. The House
committee said that it expects APHIS to submit quarterly progress reports that cover
data usage, confidentiality, and cost issues; the Senate committee report expects
APHIS to consult with private industry and to include industry components in a
national ID program, among other things. Shortly after the BSE-positive cow was
discovered in December 2003 in Washington state, USDA had promised to accelerate
work on such a national system, so that in case of an animal disease outbreak of any
type, suspect animals’ whereabouts could be traced within 48 hours. The House also
directs that no less than $2 million be provided for a cooperative agreement with the
Wisconsin Livestock Identification Consortium, and no less than $600,000 for the

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Farm Animal Identification and Records program, both to work in support of a
national system. The Senate version earmarks some funds for these programs as
well. USDA since 2004 has funded a variety of state and tribal agencies to conduct
pilot projects and data in preparation for a national system. (See CRS Report
RL32012, Animal Identification and Meat Traceability.)
Other non-USDA agencies also have BSE-related responsibilities. For example,
the Food and Drug Administration (FDA) at the Department of Health and Human
Services (HHS) regulates the safety of all human foods other than meat and poultry,
human drugs, and animal feed ingredients. Both the House and Senate versions
provide, within the total available for FDA, the full $29.6 million requested by the
Administration for the agency’s BSE activities in FY2006, and the same level as in
FY2005. Most of the funding is for enforcement of FDA’s animal feeding
restrictions (imposed in 1997 to ensure that potentially BSE-infective materials are
not introduced). FDA currently is considering whether to tighten further the existing
feed restrictions; it also wants to use FY2006 funds to continue to identify risky
materials and to conduct research to decontaminate and deactivate BSE prions. (See
CRS Issue Brief IB10127, Mad Cow Disease: Agricultural Issues for Congress.)
U.S.-Japan Beef Trade Issue. The Senate on September 20, 2005, also
adopted, 72 to 26, a floor amendment to bar USDA implementation of a proposed
rule enabling Japan to export beef to the United States, unless Japan has opened its
own markets for U.S. beef and beef products. USDA has banned the importation of
Japanese beef since September 2001 when the first of approximately 20 native cases
of BSE was reported there. USDA published the proposed rule on August 16, 2005.
However, the Japanese have not yet implemented their own policy changes to permit
U.S. beef imports. Adoption of the Senate amendment reflects the increasing
frustration of many lawmakers who believe that Japan has not lived up to its
obligations, spelled out in an October 2004 framework agreement, for resuming
normal beef trade between the two countries. Before the U.S. BSE case brought
trade to a virtual halt, Japan was the most important foreign market for U.S. beef,
accounting for 37% of total beef exports valued by USDA at $3.1 billion in 2003.
(See CRS Report RS21709, Mad Cow Disease and U.S. Beef Trade.)
Agricultural Marketing Service (AMS). AMS is responsible for promoting
the marketing and distribution of U.S. agricultural products in domestic and
international markets. The House recommends a total of $95.4 million for AMS
programs, which includes $79.3 million in direct budget authority plus a $16.1
million transfer from USDA’s Section 32 account, which AMS administers.2 The
Senate version contains $96.5 million. The Administration requested new spending
of $101.5 million for the agency in FY2006; the FY2005 enacted level is $94.7
million.
2 Section 32 funding comes from a permanent appropriation equivalent to 30% of annual
U.S. Customs receipts. AMS uses these additional Section 32 monies (also not reflected in
the above totals) to pay for a variety of programs and activities, notably child nutrition, and
government purchases of surplus farm commodities not supported by ongoing farm price
support programs. For an explanation of this account, see CRS Report RS20235, Farm and
Food Support Under USDA’s Section 32 Program.

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Within the AMS total, the Administration requested and the House approved
$1.3 million for payments for state marketing activities, compared with the FY2005
enacted level of $3.8 million. The difference reflects a specialty markets grant made
in FY2005 to the Wisconsin Department of Agriculture as well as a grant to the
Florida Department of Citrus. The Senate version contains $3.8 million, and
continues the Wisconsin project.
Approved during House committee markup, as part of a package of amendments
by the Chairman, was a new appropriation of $1 million for AMS specifically for the
Farmers Market Promotion Program. Authorized by Section 10605 of the 2002 farm
bill (7 U.S.C. 3005) but not previously funded, the program requires USDA to
provide grants for establishing, improving, and promoting farmers’ markets and other
direct marketing activities. The Senate bill does not contain the $1 million item.
(See also CRS Report RS21652, Farmers’ Markets: The USDA Role.)
Neither the House nor Senate measure recommends the Administration’s
proposed plan for new AMS user fees, to replace nearly $3 million in appropriated
funding for the development of commodity grade standards. The Administration has
argued that users of commodity grading, who already pay user fees for such services,
should also be charged for the development of the grades themselves, because they
are the direct beneficiaries. However, the committee said it will consider such fees
if they achieve authorization. New fees would be in addition to the estimated $204
million in existing user fees paid by industry for various AMS activities, which are
not included in the above AMS budget authority totals.
Country-of-Origin Labeling (COOL). AMS asked for an increase of $3.1
million specifically to implement oversight of the mandatory country of origin
labeling program that currently is scheduled to take effect in 2006 for many retailers
of fresh meats, fruits, vegetables, and peanuts. This amount is specifically included
in the Senate report accompanying its bill. On the House side, neither the bill nor the
accompanying report explicitly mentions this increase. Rather, the measure includes
language (Section 769) prohibiting use of funds to implement COOL for meat or
meat products. According to observers, the language is intended to postpone
implementation of the meat COOL. Pending in the House Agriculture Committee
is legislation (H.R. 2068) introduced by its chairman that would replace the
mandatory program for meats with a voluntary program. (See CRS Report 97-508,
Country of Origin Labeling for Foods.)
A House floor amendment by Representative Rehberg to delete the language in
Section 769 and essentially proceed with mandatory COOL implementation was
defeated by a vote of 187 to 240. The Senate version does not change current COOL
requirements, suggesting that the fate of the House language will be determined by
conferees. The Senate has been viewed as more supportive of mandatory COOL than
the House.
National Organic Program. The Organic Foods Production Act (OFPA) of
1990 required USDA to develop national standards for organically produced
agricultural products. Consequently, AMS promulgated final regulations in 2000
adopting such standards and requiring that agricultural products labeled as organic
meet them. During floor debate on September 21, 2005, the Senate approved by

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voice vote an amendment directing USDA to evaluate any impacts of a recent court
decision on the National Organic Program. In that 2005 decision, a federal court
essentially called on USDA to tighten its rules in order to prohibit use of the official
organic label on products containing synthetic substances, and also to require organic
dairy herds to use 100% organic feed.3
In a report due to Congress within 90 days of enactment, the Secretary of
Agriculture also would have to determine whether restoring the National Organic
Program as it was before the court decision “would adversely affect organic farmers,
organic food processors, and consumers”; analyze issues on the use of synthetic
ingredients in processing and handling; analyze the utility of expedited petitions for
commercially unavailable agricultural commodities and products; and consider the
use of crops and forage from land included in the land of dairy farms in their third
year of organic management. The amendment, by Senator Leahy, is not in the House
version. It addresses a dispute between many in the organic food industry who
contend that generally insignificant amounts of non-organic substances should be
allowed in organically-labeled products — and who want to restore the organics rules
to the pre-court decision — and consumer groups who want a “purer” standard
enforced for such products, according to a food trade publication.4
Grain Inspection, Packers, and Stockyards Administration (GIPSA).
One branch of this agency establishes the official U.S. standards, inspection and
grading for grain and other commodities. Another branch ensures fair-trading
practices in livestock and meat products. The latter branch has been working to
improve its understanding and oversight of livestock markets, where increasing
concentration and other changes in business relationships (such as contractual
relationships between producers and processors) have raised concerns among some
producers about the impacts of these developments on farm-level prices.
The House-passed bill provides $38.4 million for GIPSA in FY2006; the Senate
version contains a similar amount. This appropriation would be below the
Administration’s proposed program level of $40.4 million, but higher than the
approximately $37 million appropriated for FY2005. Neither bill recommends
replacing an estimated $24.7 million of GIPSA’s appropriation with user fees, as
proposed by the Administration. USDA said in its budget materials that new
legislation is being proposed to permit collection of fees for grain standardization and
Packers and Stockyards licensing activities. For FY2005, the Administration
similarly had proposed, but Congress did not adopt, new user fees of more than $29.4
million.
The House report reiterates its interest in GIPSA’s ongoing study of livestock
marketing practices, which began with a $4.5 million appropriation in F2003 and is
now expected to be completed in mid-2006. The committee directs GIPSA to report
regularly on the study’s progress. The committee expresses concern about the
confidentiality, use, and costs of the data collected and asks that GIPSA’s reports
address these issues.
3 Harvey v. Veneman, 396 F.3d 28 (1st Cir. Me. 2005).
4 Food Chemical News, August 8, 2005; September 26, 2005.

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CRS-28
Rural Development
Three agencies are responsible for USDA’s rural development mission area: the
Rural Housing Service (RHS), the Rural Business-Cooperative Service (RBS), and
the Rural Utilities Service (RUS). An Office of Community Development provides
community development support through Rural Development’s field offices. The
mission area also administers the rural portion of the Empowerment Zones and
Enterprise Communities Initiative and the National Rural Development Partnership.
The Senate- and House-passed bills recommend $2.534 billion and $2.471
billion, respectively, for USDA’s discretionary rural development programs. The
Senate measure is $120.7 million more than enacted for FY2005, $76.3 million more
than requested, and $63.5 million more than the House bill. The recommendation
would support $11.732 billion in direct and guaranteed loans ($1.384 billion more
than FY2005), as well as numerous grant and technical assistance programs, and
salaries and expenses. This recommended loan authorization level is $3.158 billion
more than requested. Separately, as was the case in FY2005, both the Senate and
House bills recommend cancelling mandatory funding for various rural development
programs authorized in the 2002 farm bill (see Table 4). Several of these programs,
however, are recommended for funding through discretionary appropriations,
although at lesser amounts than the mandatory authorization.
Like the House bill, the Senate-passed measure does not recommend the
Administration’s proposal that several rural development programs be consolidated
with other economic development programs into a new community development
program administered by the U.S. Department of Commerce (the Strengthening
America’s Communities Initiative).
The House bill encourages the RBS to implement a loan guarantee fee for
Business and Industry guaranteed loans. The measure also directs the USDA to
promulgate final rules for implementing the Household Water Well System Grant
Program and recommends funding a pilot program to train and certify inspectors in
well construction and maintenance. The Senate measure does not make these
recommendations. The Senate bill recommends $1.5 million for the Denali
Commission to address deficiencies in solid waste disposal sites. The House bill did
not make a similar recommendation.
Rural Community Advancement Program (RCAP). RCAP, authorized
by the 1996 farm bill (P.L.104-127), consolidates funding for 12 rural development
loan and grant programs into three funding streams. The Senate-passed bill
recommends $705.1 million for RCAP, $5.2 less than enacted for FY2005 and
$183.4 more than requested. The House bill recommends about $47 million less
($657.4 million) than the Senate measure. Virtually all of the difference between
House and Senate measures is accounted for by the Senate bill’s recommendation of
$86.7 million for the community facilities account versus $38.0 million
recommended for that account in the House measure. The Senate measure is
approximately $3 million less than enacted for the community facilities account for
FY2005 ($89.2 million). The Senate bill recommends approximately the same as the
House measure for the rural utilities account ($528.1 million and $531.2 million,
respectively) and for the business development account ($90.2 million and $88.2

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CRS-29
million, respectively). FY2005 funding enacted for the utilities account and the
business development account was $552.7 and $74.2, respectively.
As in past years, the Senate bill makes directed spending recommendations
within the RCAP accounts. The level of this recommended directed funding from
the various RCAP accounts is not significantly different from similar
recommendations enacted for FY2005 or from the House recommendations, but is
appreciably higher than requested by the Administration (see Table 5).
Table 4. Reductions in Mandatory Rural Development Programs
($ million)
FY2005
FY2006
Difference
Enacted
FY2006
FY2006
Authorized
from
(P.L. 108-
House
Senate
Level under
FY2006
Program
447):
Bill
Bill
2002 Farm
Authorized
Allowed
H.R. 2744 H.R. 2744
Bill
Level
Level
Enhancement of
$0
$50
$0
$0
- $50
Rural Access to
Broadband
(§ 6103)
Rural Business
$11
$100
$0 $0
-
$89
Investment
Program
(§ 6029)
Rural Strategic
$0
$100
$0
$0
$100
Investment
Program
(§ 6030)
Value-added
$15.5*
$120
$55.5*
$15.5*
- $120
Product Market
Development
Grants
(§ 6401)
Rural Firefighters
$0
$40
$0
$0
- $40
(§ 6405)
Renewable Energy
$23*
$23
$23*
$23*
- $23
Systems
(§ 9006)
Bioenergy Program
$36
$150
Not to
Not to
- $90
(§9010)
exceed
exceed
$60
$60
Biomass R&D
$14
$14
Not to
Not to
- $2
(§9008)
exceed
exceed
$12
$12
Source: Congressional Budget Office
* Funding provided in the bill is discretionary, not mandatory as authorized.

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CRS-30
Table 5. Directed Spending in the Rural Community
Advancement Program (RCAP) Accounts
($ million)
FY2006
FY2006
FY2006
FY2005
Program
Budget
House Bill
Senate Bill
Enacted
Request
H.R. 2477
H.R. 2477
Water and waste disposal
$25.0
$9.0
$24.0
$26.0
loans and grants for Native
Americans
Water and waste disposal
$25.0
$11.8
$25.0
$25.0
loans and grants for Colonias
Economic Impact Initiative
$20.7
$0
$0
$20.0
Grants
Rural Community
$6.3
$0
$6.2
$6.5
Development Initiative
Grants
High Energy Costs Grants
$27.7
$0
$0
$28.0
Water and waste disposal
$26.0
$11.8
$0
$26.0
loans and grants to Alaska
Native Communities
Water and waste water
$18.2
$16.2
$17.5
$18.2
technical assistance
Well systems
$0.992
$0
$0
$0.992
Circuit Rider Program
$13.5
$9.5
$14.0
$13.5
Rural Business Enterprise
$40
$0*
$40.0
$40.0
Grants
Rural Business Opportunity
$3.0
$0*
$3.0
$3.0
Grants
Business and Industry
$29.4
$44.2
$44.2
$44.2
Guaranteed Loans (subsidies)
Empower Zones/Enterprise
$22.2
$13.4*
$0
$0
Communities and REAP
Delta Regional Authority
$1.0
$0
$0
$3.0
* The Administration has requested that these programs be consolidated into the Strengthening
America’s Communities Initiative.
Rural Business-Cooperative Service. For FY2006, the Senate and House
bills recommend an appropriation of $86.7 million and $135.3 million, respectively,
for RBS loan subsidies and grants. The Senate-passed bill includes $25.0 million
for Rural Cooperative Development Grants, $39.0 million less than the House bill
recommendation. Both the House and Senate bills recommend $59.2 million in loan

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CRS-31
authorization levels, nearly the same as enacted for FY2005 and the same as
requested. Total recommended budget authority in the Senate measure, however, is
$29.4 more than requested.
As noted in Table 4, above, the House and Senate bills also support the
Administration’s request and recommend prohibiting the use of authorized
mandatory funds for the $40.0 million Value-Added Agricultural Product
Development grants in FY2006, as in FY2005. The House bill recommends $55.5
million in discretionary funding, an increase of $40.0 million over the amount
enacted for FY2005 and requested. The Senate bill, however, recommends $15.5
million in discretionary funding for the program. As in FY2005, both the House and
Senate measures also recommend prohibiting the use of the $23.0 million in
authorized mandatory funds for the Renewable Energy Grants program, and request
$23.0 million in discretionary funds instead. This is the same as enacted for FY2005
and $13.0 million more than requested. Consistent with the Administration’s
request, both the House and Senate bills again recommend that $100.0 million for the
Rural Strategic Investment Fund be cancelled for FY2006.
For the Empowerment Zone/Enterprise Community Program, the Senate
measure recommends $12.4 million, the same as enacted for FY2005 and $12.4
million more than the $0 requested. The House measure recommends $10.0 million
for the program. Neither the House nor Senate bills recommends directed spending
for the EZ/EC programs through the RCAP accounts (Table 5). Thus, the House and
Senate are funding the EZ/EC program directly rather than replacing funds as the
Administration requested, or supplementing funds as in previous years, by directing
spending from the RCAP account.
Rural Utilities Service (RUS). The Senate and House bills recommend
budget authority of $105.6 and $92.5 million, respectively, for RUS (compared with
$102.2 million enacted in FY2005). The Senate measure would support an estimated
FY2006 loan level of $6.745 billion, and the House measure $5.508 billion
(compared with $5.606 billion estimated for FY2005).5 The House recommended
loan authority is $1.959 billion more than requested and the Senate level is $3.158
billion more. Both the Senate and House measures recommend $6.2 million in loan
subsidies for the rural electrification program. This would support a loan
authorization level of $4.300 billion under the House recommendation and $5.500
billion under the Senate measure. The Senate measure includes a higher loan
authorization level than the House bill for Federal Financing Bank loans. For
telecommunications loans, the Senate and House bills recommend approximately the
same loan authorization levels for the telecommunications loans. This program level
is about $176.0 million more than enacted for FY2005 and $25.0 million more than
requested.
Both House and Senate bills again recommend cancelling $20.0 million in
mandatory funding for the Enhancement of Access to Broadband Service authorized
in the 2002 farm bill. For the broadband loan program, the Senate measure
5 These figures do not include water and waste water loans and grants also administered by
RUS. Water and waste disposal loans and grant are included under the RCAP appropriation.

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CRS-32
recommends $11.8 million in subsidies, about $1.8 million more than the House bill
and the requested amount. The Senate bill’s recommended loan subsidy level
supports a program level of $550.0 million. This program level is $86.1 million
more than the House bill and $191.0 million more than requested. The Senate
measure recommends $10.0 million for broadband grants, $1.0 million more than the
House recommendation and nearly the same as the enacted FY2005 level. The
Administration requested no funding for the grants program. For the distance
learning and telemedicine program, the Senate and House passed bills recommend
$35.0 and $25.0 million, respectively, in grants, nearly the same as enacted for
FY2005. The House measure also recommends $50.0 million in direct loan
authorization for the telemedicine and distance learning program, the same amount
enacted for FY2005, while the Senate measure requested no loan authorization. The
Administration requested no loan authorization for the program for FY2006.
Rural Housing Service. To support a total of $4.928 billion in rural housing
loan authority, the Senate-passed bill recommends an FY2006 appropriation of
$1.471 billion, approximately $25.0 million more than recommended by the House
measure and about $102.0 million more than enacted for FY2005. The
Administration had requested $1.626 billion. Total recommended loan authorization
in the Senate-passed bill is $244.3 more than enacted for FY2005 and $38.0 million
less than requested.
The Senate measure recommends $1.000 billion in direct loan authorization for
the Section 502 single family housing program, supported by a requested
appropriation of $113.9 million. The House bill recommends $140.0 million more
in loan authorization and approximately $17 million more in budget authority. For
Section 502 guaranteed housing loans, both Senate and House bills recommend $40.9
million in subsidies, approximately $7.6 million more than enacted for FY2005, to
support a program level of $3.681 billion. For Section 515 rental housing loan
subsidies, the House bill recommends requests $45.9 million, approximately the
same as enacted for FY2005 and $4.5 million more than the House measure. For
Section 504 housing repair grants, the Senate and House bills recommend
approximately $10 million, nearly the same as enacted for FY2005 and as requested.
Rental assistance payments for Section 521 housing would increase to $644.1 million
under both the House and Senate bill recommendation, up from $581.4 million
enacted for FY2005. Senate recommended budget authority for farm labor housing
loan subsidies (Section 514) and farm housing grants (Section 516) would decrease
by $4.2 million over the FY2005 enacted amount to $29.6 million.
For more information on USDA rural development programs, see CRS Report
RL31837, An Overview of USDA Rural Development Programs.
Domestic Food Assistance
Funding for domestic food assistance represents the majority of USDA’s budget.
The bills adopted by the House and Senate for FY2006 recommend a total of $58.71
billion, and generally conform to the Administration’s request for $58.96 billion.
The main reason for the lower House/Senate amount is a reduced appropriation for
the Special Supplemental Nutrition Program for Women, Infants, and Children (the
WIC program) based on newer estimates from the Administration.

---

CRS-33
The Administration’s FY2006 appropriations (new budget authority) request
for domestic food aid programs administered through the USDA represents $6.5
billion increase over the FY2005 amount ($52.488 billion).6 However, the
Administration’s budget anticipates that actual spending (obligations) will increase
to a lesser degree — about $4.4 billion, from $52.068 billion in FY2005 to $56.423
billion in FY2006.7 The net difference between the appropriation and spending
amounts is accounted for by additional “contingency” appropriations (e.g., $3 billion
for food stamps), offset by spending financed from money available from prior fiscal
years and other USDA accounts (e.g., permanent appropriations and commodity
purchases).
The domestic food aid budget request generally is derived from Administration
projections of program caseloads and inflation-indexed benefit levels; most are
“entitlement,” not “discretionary,” programs. The budget, and the House and Senate
bills, effectively propose to “fully fund” all but one domestic food assistance effort
based on Administration estimates as to the need for aid; the Commodity
Supplemental Food program would serve fewer people than in FY2005. However,
linked to its budget, the Administration also put forward a number of new program
initiatives that would affect spending — e.g., constraining the number of participants
in the Food Stamp program and the WIC program using revised eligibility rules,
ending special bison meat purchases. The House and Senate have has adopted some
of these, and the Senate bill includes some additional changes.
Programs under the Food Stamp Act. Appropriations under the Food
Stamp Act provide funding for (1) the regular Food Stamp program, (2) a Nutrition
Assistance Block Grant for Puerto Rico (in lieu of food stamps), (3) commodities and
administrative expense aid through the Food Distribution Program on Indian
Reservations (FDPIR), an alternative to food stamps for living on or near Indian
reservations, (4) small nutrition assistance grant programs in American Samoa and
the Commonwealth of Northern Mariana Islands, (5) commodities for The
Emergency Food Assistance Program (TEFAP), and (6) the Community Food
Project.
For Food Stamp Act programs, the House bill provides the Administration-
requested appropriation, effectively adopting the Administration’s spending
projections (discussed below). The FY2006 budget asks for a total appropriation of
$40.711 billion, an increase of $5.5 billion over the FY2005 figure of $35.155
6 Not included in these figures are permanent appropriations, the value of commodities
required to be purchased (under “Section 32” authority) for child nutrition programs, and
the value of “bonus” commodities acquired for agriculture support reasons and donated to
various food assistance programs. These items are recognized in, but generally not include
as part of, the regular appropriations process; they totaled to $901 million in FY2005 and
are expected to add up to $918 million in FY2006.
7 Not included in these spending totals are purchases of “bonus” commodities acquired for
farm-support reasons, obligations made to replenish the contingency fund for the Special
Supplemental Nutrition Program for Women, Infants, and Children (the WIC program), and
spending on food stamp benefits made from funds provided by states. These items total to
over $500 million in FY2005 and FY2006.

---

CRS-34
billion. This includes $3 billion for a “contingency reserve” in case current estimates
of need prove too low.
The Administration’s Food Stamp Act spending estimate for FY2006 is $37.739
billion, a $3.5 billion increase over the FY2005 level. Spending for the regular Food
Stamp program is expected to rise by $3.5 billion, to $36.001 billion in FY2006.
Puerto Rico’s nutrition assistance grant will go to $1.516 billion, up $21 million from
FY2005. Overall spending for the FDPIR is anticipated to decline from $82 to $78
million.8 Costs for the American Samoa and Northern Mariana Islands programs are
effectively unchanged (at $14 million in total). And the FY2006 budgeted amounts
for TEFAP commodities and the Community Food Project are the same as for
FY2005 — $140 million and $5 million respectively.9
As with the House bill, the version adopted by the Senate would appropriate the
Administration’s request ($40.711 billion). But, unlike the House bill, it earmarks
$4 million of this amount for a special bison meat purchase program for the FDPIR,
increasing spending on the FDPIR to $82 million in FY2006. The Senate bill also
includes an amendment dealing with “privatization” of food stamp administrative
operations (see New Program Initiatives, below).
Child Nutrition Programs. Child nutrition programs would be appropriated
$12.416 billion for FY2006 under the Administration’s budget, up $634 million from
$11.782 billion in FY2005. These activities include the School Lunch and Breakfast
programs, the Child and Adult Care Food program, the Summer Food Service
program, after-school and outside-of-school nutrition programs, the Special Milk
program, food commodities required to be bought for schools and other providers,
assistance to states with their child-nutrition-related administrative costs, and
nutrition education (e.g., “Team Nutrition”), food safety, and program integrity
initiatives.
The House-passed provides a slightly smaller-than-requested appropriation —
$12.412 billion. Although this amount eliminates $4 million for a proposed program
integrity study of the Child and Adult Care Food program, it effectively adopts the
rest of the Administration’s spending projections. The bill passed by the Senate
includes $12.422 billion for child nutrition and includes several special child
nutrition program initiatives (see New Program Initiatives, below).
Under the House scenario, the spending estimate for FY2006 (including
funding sources other than regular appropriations such as the value of commodities
purchased from different USDA budget accounts, permanent appropriations, and
8 Under the Administration’s budget and the House-passed bill, FY2006 money for the
FDPIR is scheduled for a decrease because of the proposed elimination of a special bison
meat purchase project and the availability of commodity inventory carryover from FY2005
that can be used for the FY2006 program. Actual participation is expected to increase.
9 An additional $50 million a year for TEFAP distribution/administrative costs is available
from the Commodity Assistance budget account (the same as FY2005), and the House and
Senate bills would allow up to $10 million of the $140 million appropriated for TEFAP
commodities to be used for distribution/administrative expenses.

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CRS-35
carryover funds from previous years) is $12.909 billion ($4 million below the
Administration’s spending estimate). This is an increase of $541 million over
FY2005 estimates and includes money ($38 million) for initiatives that received
permanent appropriations under the 2004 Child Nutrition and WIC Reauthorization
Act (P.L. 108-265) — the Food Service Management Institute, an information
clearinghouse, a fresh fruit and vegetable program for selected schools, various
demonstration projects, and efforts to increase integrity in child nutrition programs.
It does not include money for an integrity project related to the Child and Adult Care
Food program; nor does it include specific funding for an authorized pilot expanding
eligibility for free school meals (although House report language “encourages” the
USDA to carry out the project). The Senate scenario is the same, except that $10
million more would be spent for nutrition education activities through the “Team
Nutrition” project.
The WIC Program. The Special Supplemental Nutrition Program for
Women, Infants, and Children (the WIC program) would have received an FY2006
appropriation of $5.510 billion under the Administration’s original budget request,
a $275 million increase over FY2005. However, as noted in the House and Senate
reports on the FY2006 appropriation, the Administration has revised its projection
of WIC participation and food costs downward. As a result, the House and Senate
bills appropriate $5.257 billion, a $22 million increase from FY2005. They also (1)
include money to replenish a $125 million “contingency reserve” (in case current cost
projections are too low), (2) contemplate carrying a small amount of unused funding
into FY2007, (3) rescind $32 million in unobligated carryover funds from FY2005,
(4) earmark $14 million for breastfeeding support initiatives, and (5) in the Senate
version, earmark $20 million for state management information systems.
Commodity Assistance Programs. The commodity assistance budget
account covers four program areas: (1) the Commodity Supplemental Food Program
(CSFP), (2) funding for TEFAP distribution/administrative costs (in addition to
commodities provided through money under the Food Stamp Act account and
“bonus” commodities acquired for farm-support purposes), (3) two farmers market
programs for WIC participants and seniors, and (4) food donation programs for
disaster assistance, aid to certain Pacific Islands affected by nuclear testing, and
commodities supplied to Older Americans Act grantees operating the Nutrition
Services Incentive program for the elderly.
For FY2006, the Administration proposes a total appropriation of $178 million
for this account, up only slightly from the $177 million available in FY2005. Under
this budget account, the actual spending level for FY2006 is anticipated to total just
over $195 million (incorporating funding supported by other budget accounts). This
is roughly the same spending level as FY2005 and includes $107 million for the
CSFP,10 $50 million for TEFAP distribution/administrative costs, $35 million for the
10 Total spending to support the CSFP (including funds and commodities carried over from
FY2005) is projected to rise by $2 million to $113 million in FY2006. However, despite
this increase, the FY2006 CSFP budget effectively dictates a significant caseload reduction
of at least 45,000 persons because of rising food and administrative costs.

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CRS-36
two farmers market nutrition programs ($20 million for the WIC component and $15
million for the seniors component), and $4 million for other food donation activities.
Both the House and Senate bills provide a small increase over the
Administration’s request. The House includes $179 million, and the Senate
appropriates $180 million. In both cases the additional dollars ($1 million and $2
million) are to be available for the CSFP.11
Nutrition Program Administration. This budget account covers money
for federal administrative expenses related to domestic food assistance programs and
special projects. For FY2006, the Administration has asked for an appropriation (and
spending) of $141 million, up $1.9 million from FY2005. The House and Senate
bills provide the amount asked for by the Administration.
In addition, this account includes money for the Congressional Hunger Center;
$2.5 million was appropriated for FY2005. The Administration’s FY2006 budget
does not request funding for the center. However, in Title VII of the House and
Senate bills, $2.5 million is appropriated.
New Program Initiatives. In addition to ending funding for the
Congressional Hunger Center (noted above), the Administration has proposed several
initiatives that would create budget savings, change the terms under which domestic
food aid programs operate (potentially affecting participation), or add new funding.
These proposals include (1) constraining food stamp spending by ending eligibility
for some households that would not meet regular food stamp tests but receive other
public assistance benefits (estimated to save $57 million in FY2006 and just over
$100 million a year in later years and affect some 300,000 persons yearly), (2)
authorizing state agencies that administer the Food Stamp program to access the
National Database of New Hires to help verify food stamp eligibility (estimated to
save $2 million a year), (3) continuing current food stamp rules that do not count
special military pay for those deployed to combat zones (estimated to cost $1 million
in FY2006), (4) ending a special bison meat purchase program for the FDPIR
(estimated to save $4 million in FY2006), (5) capping the proportion of state WIC
grants that can be spent on nutrition services and administration at 25%, (6) imposing
an income limit (250% of the federal poverty guidelines) on those who can get WIC
services/benefits automatically because of their participation in the Medicaid
program, (7) continuing a rule barring approval of any new retailers in the WIC
program whose major source of revenue is derived from the WIC program (so-called
“WIC-only” stores), and (8) appropriating $3 million for a WIC performance
measurement project.
The House-passed bill adopts the food stamp military pay proposal, ending the
special bison meat purchase project, imposing an income limit on WIC/Medicaid
recipients, and a continuation of the bar on new WIC-only stores. The Senate-passed
bill incorporates the military pay proposal and continuing the bar against WIC-only
stores. Other items on the Administration’s agenda may be taken up by the
11 These increases would not reverse the expected caseload reduction noted in the preceding
footnote.

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CRS-37
appropriate authorizing committees (e.g., ending automatic food stamp eligibility for
some public assistance recipients) to the extent that they require a change in law
rather than an appropriation.
The Senate-passed bill also includes several special provisions. These (1) make
seven more states eligible for so-called “Lugar” status in the Summer Food Service
program (i.e., allowing reduced documentation requirements for summer project
sponsors), (2) provide $2 million to expand the program providing fruits and
vegetables in selected schools to two additional states, (3) continue to allow the
reallocation of unused audit funds in the Child and Adult Care Food program, (4)
make federal money supporting development of local school “wellness” policies
available in October 2005 (rather than July 2006), (5) provide an additional $10
million for child nutrition education activities through the “Team Nutrition” project,
and (6) bar federal cost-sharing for state food stamp administrative costs in cases
where the state contracts out (“privatizes”) more than 10% of its administrative
expenses (other than those for benefit issuance and nutrition education).12 The final
two changes noted above were added by Senate floor amendments.
Food and Drug Administration (FDA)
The Food and Drug Administration (FDA), an agency of the Department of
Health and Human Services (HHS), is responsible for regulating the safety of foods,
and the safety and effectiveness of drugs, biologics (e.g., vaccines), and medical
devices. For FY2006, the House passed a program level of $1.868 billion, slightly
below the President’s request of $1.882 billion, but a $67 million (3.7%) increase
over the enacted FY2005 level of $1.801 billion. The Senate approved a level of
$1.874 billion, $7.8 million below the budget request but $73 million (4.1%) over the
FY2005 level. These totals represent a combination of congressional appropriations
under two categories: (1) salaries and expenses, and (2) buildings and facilities and
various user fee authorizations.
In FDA’s annual appropriation, Congress sets both the total amount of
appropriated funds and the level of user fees to be collected that year. For
appropriated funds for salaries and expenses, the House agreed to $1.481 billion for
FY2006, $11.7 million (0.8%) less than the President’s budget request of $1.493
billion but $30.9 million (2.1%) more than the FY2005 appropriation of $1.450
billion. The Senate agreed to $1.485 billion, $7.7 million (0.5%) less than the
President’s request but a $34.9 million (2.4%) increase over the FY2005
appropriation. For user fees, both the House and Senate authorized FDA to collect
$381.8 million, an increase of $31.3 million (8.9%). User fees in three major
programs that cover prescription drugs, medical devices, and animal drugs would
account for $357 million of the FY2006 total (equal to the President’s request), with
the remaining $24.8 million coming from mammography clinics certification and
export and color certification fees.
12 The administrative cost amendment effectively bars states planning to contract out major
parts of their food stamp administrative operations statewide (like Texas) from doing so,
unless they are willing to lose federal payments.

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CRS-38
The House recommends a $5 million appropriation for the maintenance of
buildings and facilities in FY2006, but the Senate passed a $7 million appropriation,
the same as the President’s request. The FY2005 appropriation, differing from
earlier years’ appropriations, did not include maintenance funding. FDA, therefore,
absorbed the FY2005 costs of maintaining its facilities within its program funds. In
addition to recommending funding for buildings and facilities, the Senate has
prohibited funds to be used to close or relocate FDA’s Division of Pharmaceutical
Analysis in St. Louis, Missouri. The Senate also gives the Secretary of Health and
Human Services authority to relinquish all or part of the lands and properties of the
National Center for Toxicological Research and the Arkansas Regional Laboratory.
Counterterrorism
The House’s recommendation for counterterrorism for FY2006 is $257.5
million, $13.4 million (5.5%) more than the President’s request of $244.1 million,
and a 20.3% increase over the $214 million enacted for FY2005 (see Table 6). This
funding is part of each program center’s request and is included in the total
appropriation request for FDA.
Table 6. FDA Counterterrorism Funding
($ thousands)
FY2006
FY2006
FY2004
FY2005
FY2006
Program
House-
Senate-
Enacted
Enacted
Request
passed
passed
Food Safety and Defensea
$115,660
$149,952
$180,026
$192,466
$196,602
Drugs
19,061
21,884
21,884
21,884
21,884
Biologics
25,544
25,340
25,340
25,340
25,340
Device & Radiological
5,731
5,685
5,685
5,685
5,685
Health
Toxicological Research
3,173
3,148
3,148
3,148
3,148
Other Activities
1,409
1,398
1,398
1,398
1,398
Rent 6,660

6,607
6,607
6,607
6,607
Total $177,238
$214,014
$244,088
$256,528
$260,664
Source: FDA’s Office of Budget and Budget Formulation, July 5, 2005.
a. Food Safety and Defense category includes funding for the National Center for Toxicological
Research (NCTR).
Most of the funding (75%) for counterterrorism activities is for food defense.
The request for food defense is $180 million, $30 million (20%) more than the
FY2005 appropriation of $150 million. The House agreed to $192.5 million, a 28%
increase, while the Senate was more generous, recommending $196.6 million, a 31%
increase over FY2005. The House report directs the agency to give priority to
maintaining existing personnel and operations critical to ensuring the safety of
domestic and imported food rather than funding new functions, grants, or

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CRS-39
agreements. The Senate report also wanted the agency to use funds provided to
support current activities and staff levels before engaging in new activities. The
additional funds for food defense will be used for the Food Emergency Response
Network (FERN), a nationwide FDA-FSIS network of federal and state laboratories
capable of testing thousands of food samples within days for certain biological,
radiological, and chemical threat agents. The increase also will fund research on
food testing methods and related areas, will conduct about 60,000 food import field
inspections, of which 38,000 are risk-based inspections of potentially high-risk food
import entries. The increase also will be used in augmenting FDA’s crisis
management capability by boosting FDA’s rapid and coordinated response to food
threats and food-associated crises, and by creating a central hub to relay all
emergency information to FDA and interested stakeholders. (For more information,
see CRS Report RL31853, Food Safety Issues in the 109th Congress.)
The increase in funding for medical countermeasures will be spread over the
various categories in Table 6. Some of these medical countermeasure activities also
will be funded under Project BioShield, a program designed to help ensure that
medical products for use in the event of war or catastrophic events are reviewed and
approved quickly for safety and effectiveness. Some funding will be used to assist
companies in developing new countermeasures. Also, some will allow FDA to
implement regulations to provide for “emergency use authorization” when the
countermeasure is still in a developmental stage.
Food
The House included $444.1 million for the foods program of the Center for
Food Safety and Applied Nutrition (CFSAN) and the center’s field activities, while
the Senate recommended $450.2 million. These amounts are down from the
President’s request of $461 million, but the House’s is $8.6 million (2%) more than
the enacted FY2005 budget of $435.5 million while the Senate recommendation is
$14.7 million (3.4%) more. In addition, the House and the Senate decided to keep
the same resources ($29.6 million) as the President’s request for programs related to
prevention of bovine spongiform encephalopathy (BSE), or “mad cow” disease. The
Senate committee, however, added several details in its report concerning yearly
inspections of all renderers and feed mills and urged the agency to validate test
methods for BSE-related proteins in feed, and to continue research on transmissible
spongiform encephalopathies in FDA’s centers.
The House noted that the agency was developing with FSIS regulations on the
use of sausage casings/small intestines of cattle and is concerned about the
availability of this material, which is not a BSE-related specified risk material. It
wants a report within 30 days of enactment on the regulation’s status and on the
guidance being developed for field offices. The Senate is interested in the naturally
occurring as well as industrial contaminant “perchlorate” found in produce, milk, and
bottled water, and wants a report on the agency surveys of this contaminant. The
Senate also is aware of the dramatic increase in milk protein imports and wants to see
further enforcement of the standards of identity of these products to prevent potential
illegal use of milk protein concentrate in standardized cheese.

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CRS-40
Both the House and the Senate support the National Antibiotic Resistance
Monitoring System (NARMS) as being critical to public health surveillance. The
House and the Senate encourage FDA to contribute similar funding for each part of
the program, including animal surveillance, as the agency does for human
surveillance, and want a report by March 1, 2006, on this funding. The Senate in
particular directs the agency to review all components of NARMS to ensure that the
program remains scientifically sound and relevant to public health.
Both the House and the Senate direct FDA to continue supporting the National
Center for Food Safety and Technology in Summit-Argo, Illinois, with $3 million
and continue support for the development of rapid test methods of fresh fruits and
vegetable for microbiological pathogens at the New Mexico State University
laboratories. Both the House and the Senate want another report by February 1,
2006, that summarizes the results of the agency’s nutrition facts label monitoring, the
types of violations discovered, and the mitigating activities the agency took to
address the violations. The Senate also provides $1 million to create at the
University of California at Davis a center for research on food defense, particularly
research into risks found in food imports, and encourages the agency to work with
USDA and CDC on the Partnership for Food Safety Education.
Seafood Safety. Seafood safety is again a priority for both the House and the
Senate. The House and the Senate direct $250,000 to continue support for the
Interstate Shellfish Sanitation Commission (ISSC) to promote research and education
about shellfish safety and Vibrio vulnificus. Both also expect FDA to require all
states to conform to the National Shellfish Sanitation Program implemented by the
ISSC and ask FDA to devote not less than $200,000 to that work. The House and the
Senate are concerned about “chloramphenicol,” an antibiotic, in farm-raised shrimp
imports, and recommend that FDA continue testing imported shrimp at 0.3 parts per
billion. In fact, the Senate provides an increase of $500,000 for the agency to
develop, in cooperation with the states, a program for increased testing. By March
1, 2006, the House expects a report on the number of shrimp samples tested for
antibiotics and the number of positive tests for chloramphenicol found in FY2004,
in FY2005, and to date in FY2006.
The Senate wants FDA to continue to monitor additives and dyes used in farmed
salmon; to understand Hawaii’s history and practical experience in approving
HACCP plans for seafood processing plants; to address the potential public health
problems with the consumption of raw shellfish; and to continue support for food
contract inspections in Alaska.
Dietary Supplements. The Senate committee report states that $5.56 million
is to go to the food center’s Adverse Events Reporting System (CAERS), of which
$1.7 million is for dietary supplements. This amount is over the $1.1 million in the
budget request, and with this money the committee wants, within 90 days of
enactment, a report on the cost of such a system. The Senate also wants the agency
to enforce provisions of the Dietary Supplement Health and Education Act of 1994
(DSHEA) against violative products and to issue final dietary supplement Current
Good Manufacturing Practice regulations. It gave an increase of $500,000 for the
review of botanicals in dietary supplements, work being conducted for the agency by
the National Center for Natural Products Research in Oxford, Mississippi.

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CRS-41
Prescription Drugs and Biologics
The House gave FDA’s human drug program $519.8 million, $5.9 million
(1.1%) more than the Administration’s request of $513.9 million and $23.5 million
(4.7%) over the final FY2005 level of $496.3 million. The Senate recommended
$723.2 million for the human drugs and biologics programs, including $417.8 million
in appropriations and $305.3 million in user fees.
The House bill would give the Office of Drug Safety $22.9 million, with an
additional $5 million for the program to use on “the highest priority drug safety
needs.” Within 30 days of enactment, the House directs FDA to provide a detailed
spending plan for these additional funds and other Office of Drug Safety funds. The
House also expects quarterly reports giving FDA’s planned changes at least for drug
safety including review processes or reprogramming, plans for external review, new
initiatives including education efforts or labeling changes, and the results of the
Institute of Medicine study on drug safety issues. The Senate also specified
increasing drug safety activities by $5 million, requesting a report on FDA’s efforts,
including those related to orphan products. The Senate provided $750,000 to support
collaborative research (with the C-Path Institute and the University of Utah) on
“cardiovascular biomarkers predictive of safety and clinical outcomes.” (For further
information see CRS Report RL32797, Drug Safety and Effectiveness: Issues and
Action Options After FDA Approval.)
Saying that the Generic Drugs Program is part of the solution to high quality and
affordable health care, the House expresses concern that its potential is not being
met. It therefore requires that the program’s base funding not be less than $56.2
million. The Senate encourages FDA to protect the incentives in current law. The
House is also interested in which, if any, drugs, specifically abuse-resistant
formulations of schedule II painkillers, have been given priority status because they
have less potential for abuse. The House wants caregivers to get all relevant
information concerning the abuse-resistant qualities of safer drugs. Also, the House
directs that $15 million, and the Senate recommends that $14.4 million, be available
for grants and contracts awarded under the Orphan Drug Act. The Senate asks the
FDA to report on its activities regarding a monitoring system for follow-on,
off-patent biologics.
The House also provides an increase of $884,000 for the review of
direct-to-consumer drug advertisements because the numbers of ads have increased
considerably while staff levels remained flat. (For further information, see CRS
Report RL32853, Direct-to-Consumer Advertising of Prescription Drugs.)
Concerned with the medically and ethically appropriate use of HIV vaccines in
children, the House and the Senate request that the FDA Commissioner in
consultation with other public and private entities consider the logistical, regulatory,
medical and ethical issues presented by pediatric testing of these vaccines. They
want FDA to issue guidance within six months on what minimum requirements
companies must meet to obtain approval to test an HIV vaccine in children and to
receive FDA approval for a pediatric indication.

---

CRS-42
Import monitoring and inspections have taken on a more prominent role as
steadily increasing amounts of drug products are being imported under FDA’s
“personal use” import policy. The House passed an amendment prohibiting FDA
from using funds to enforce the current statute that bans importation of prescription
drugs by parties other than drug companies. The Senate-passed bill is silent on the
issue. The White House has raised the possibility of a veto if the drug import
provision remains in the final bill. (For more on this issue, see CRS Report
RL32511, Importing Prescription Drugs: Objectives, Options, and Outlook.)
The Senate encourages FDA to sufficiently fund its Office of Women’s Health,
for which the President’s request includes “not less than $4 million.” It also suggests
several improvements to clinical trial design and the use of FDA advisory
committees, including exploration of potential surrogate endpoints and other
approaches to make available drugs for serious and life-threatening orphan diseases
that have no other treatments. It also encourages FDA to continue its work with
potential manufacturers regarding development of a vaccine against pandemic
influenza.
Regarding FDA efforts to control drug counterfeiting, the Senate encourages
FDA to issue draft guidance on the use of authentication technologies and to report
on its efforts to learn from the experience of private companies. The Senate provides
$750,000 for an FDA pilot program with the United States Pharmacopeia to prepare
monographs on compounded drug preparations. Following up on FDA’s report that
it would be infeasible to develop a monograph system for older prescription drugs,
the Senate directs the FDA to develop an alternative approach to provide for their
“uniform and transparent regulation” and to prioritize enforcement resources “to
address safety and effectiveness concerns.” The Senate also urges FDA to develop
guidance regarding evaluating benefits of acne medication before adopting the Global
Evaluation Scale that some members of the public have criticized, and to report on
its citizen petition process improvement efforts.
Congressional interest in financial conflicts of interest among individuals
serving on FDA advisory panels is evident in amendments in both the House and
Senate-passed bills despite the absence of related provisions in either committee
report. Competing concerns involve attempts to free the advisory system from
industry influence, while cutting off neither FDA nor industry from the help of
experts. In a floor vote, the House approved an amendment (sponsored by
Representative Hinchey) that would prohibit FDA’s using funds in this bill to waive
financial conflict-of-interest rules for advisory panel members. The Senate passed
an amendment (introduced by Senator Durbin) that would prohibit use of funds if
such rules were waived without notifying the Secretary and disclosing on the FDA
website the conflict of interest and reasons for nevertheless appointing the individual.
Medical Devices
The Senate recommends $263.1 million in budget authority for the medical and
radiologic device program, including appropriations of $222.8 million and user fees
of $40.3 million. This includes $7.8 million for increased medical device review,
$1.8 million above the President’s request, paired with requests for biweekly updates

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CRS-43
on planned changes to MDUFMA and a report on device review performance and
spending (both user fees and appropriated funds).
Regarding diabetes treatments, the Senate urges FDA to support a workshop on
how to expeditiously review promising technologies for continuous glucose
monitoring, and to develop guidance and otherwise evaluate additional biomarkers
and surrogate endpoints and related product development and validation regarding
clinical outcomes. The Senate includes a provision to stop, by barring the use of
certain funds, a contact lens industry practice of limiting distribution to eye care
providers. The Senate expects that expanding distribution, as 32 state attorneys
general and some members of the industry had agreed in consent decrees, would
lower price and convenience obstacles to more frequent replacement of lenses, which
would increase ocular health.
Commodity Futures Trading Commission (CFTC)
The Commodity Futures Trading Commission (CFTC) is the independent
regulatory agency charged with oversight of derivatives markets. The CFTC’s
functions include oversight of trading on the futures exchanges, registration and
supervision of futures industry personnel, prevention of fraud and price manipulation,
and investor protection. Although most futures trading is now related to financial
variables (interest rates, currency prices, and stock indexes), Congressional oversight
is vested in the Agricultural Committees because of the market’s historical origins
as an adjunct to agricultural trade.
For FY2006, the Administration requested $99.4 million for the CFTC, an
increase of $5.8 million, or 6.2%, over FY2005. The House-passed bill provides an
appropriation of $98.4 million, an increase of $4.8 million, or 5.1%, over FY2005.
The Senate approved the same figure as the House, $98.4 million.

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CRS-44
Table 7. USDA and Related Agencies Appropriations,
FY2006 Action vs. FY2005 Enacted
(budget authority, in millions of $)
FY2006
FY2006
FY2006
FY2006
FY2005
Admini-
Agency or Major Program
House
Senate
Confer-
Enacteda
stration
Bill
Bill
ence
Request
Title I: Agricultural Programs
Agric. Research Service (ARS)
1,288.3
1,060.9
1,122.8
1,270.6
**
Coop. State Research Education and
1,161.7
1,018.2
1,130.7
1,167.3
**
Extension Service (CSREES)
Economic Research Service (ERS)
74.2
80.7
75.9
78.5
**
National Agric. Statistics Service
128.4
145.2
136.2
145.2
**
(NASS)
Animal and Plant Health Inspection
813.0
860.2
847.5
812.8
**
Service (APHIS)
Agric. Marketing Service (AMS)
94.7
101.5
95.4
96.5
**
Grain Inspection , Packers and
37.0
15.7
38.4
38.4
**
Stockyards Admin. (GIPSA)
Food Safety & Inspection Serv.
817.2
710.7
837.3
836.8
**
(FSIS)
Farm Service Agency (FSA) -
1,294.9
1,365.1
1,325.9
1,357.7
**
Total Salaries and Expenses
FSA Farm Loans - Subsidy Level
156.5
154.1
151.4
150.8
**
*Farm Loan Authority
3,717.8
3,803.3
3,818.3
3,743.0
**
Risk Management Agency (RMA)
71.5
87.8
77.8
73.4
**
Salaries and Expenses
Federal Crop Insurance Corp.b
4,095.1
3,159.4
3,159.4
3,159.4
**
Commodity Credit Corp. (CCC)b
16,452.4
25,690.0
25,690.0
25,690.0
**
Other Agencies and Programs
556.5
632.0
507.2
573.6
**
Subtotal
27,041.5
35,081.5
35,196.0
35,451.2
**
Title II: Conservation Programs
Conservation Operations
830.7
767.8
773.6
819.6
**
Watershed Surveys and Planning
7.0
5.1
7.0
5.1
**
Watershed & Flood Prevention
75.0
0.0
60.0
60.0
**
Watershed Rehabilitation Program
27.3
15.1
47.0
27.3
**
Resource Conservation &
51.2
25.6
51.4
51.2
**
Development
NRCS Under Secretary
0.7
0.7
0.7
0.7
**
Subtotal
991.9
814.4
939.8
964.0
**

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CRS-45
FY2006
FY2006
FY2006
FY2006
FY2005
Admini-
Agency or Major Program
House
Senate
Confer-
Enacteda
stration
Bill
Bill
ence
Request
Title III: Rural Development (RD)
Rural Community Advancement
710.3
521.7
657.4
705.1
**
Program (RCAP)
Salaries and Expenses
147.3
167.8
152.6
164.8
**
Rural Housing Service (RHS)
1,369.7
1,626.9
1,446.4
1,471.6
**
* RHS Loan Authority
4,683.3
4,965.6
5,079.3
4,927.6
**
Rural Business-Cooperative Service
83.7
57.4
121.4
86.8
**
* RBCS Loan Authority
58.7
59.2
59.2
59.2
**
Rural Utilities Service (RUS)
102.2
83.6
92.5
105.6
**
* RUS Loan Authority
5,606.0
3,548.9
5,507.9
6,745.0
**
RD Under Secretary
0.6
0.6
0.6
0.6
**
Subtotal
2,413.8
2,458.1
2,471.0
2,534.5
**
* Subtotal, RD Loan Authority
10,348.0
8,573.7 10,646.4
11,731.8
**
Title IV: Domestic Food Programs
Child Nutrition Programs
11,782.0
12,416.0
12,412.0
12,422.0
**
WIC Program
5,235.0
5,510.0
5,257.0
5,257.0
**
Food Stamp Program
35,154.6
40,711.4
40,711.4
40,711.4
**
Commodity Assistance Program
177.4
177.9
178.8
179.9
**
Nutrition Programs Admin.
138.8
140.8
140.8
140.8
**
Office of Under Secretary
0.6
0.6
0.6
0.6
**
Subtotal
52,488.4
58,956.7
58,700.6
58,711.7
**
Title V: Foreign Assistance
Foreign Agric. Service (FAS)
136.7
148.8
148.2
147.9
**
Public Law (P.L.) 480
1,293.0
965.4
1,187.5
1,230.4
**
McGovern- Dole International Food
86.8
100.0
100.0
100.0
**
for Education
CCC Export Loan Salaries
4.4
5.3
5.3
5.3
**
Subtotal
1,520.9
1,219.4
1,441.0
1,483.5
**
Title VI: FDA & Related Agencies
Food and Drug Administration
1,450.1
1,499.7
1,486.0
1,492.0
**
Commodity Futures Trading
93.6
99.4
98.4
98.4
**
Commission (CFTC)
Subtotal
1,543.7
1,599.1
1,584.4
1,590.4
**
Title VII: General Provisionsc
(409.8)
3.6
(11.0)
(17.3)
**

---

CRS-46
FY2006
FY2006
FY2006
FY2006
FY2005
Admini-
Agency or Major Program
House
Senate
Confer-
Enacteda
stration
Bill
Bill
ence
Request
RECAPITULATION
I: Agricultural Programs
27,041.5
35,081.5
35,196.0
35,451.2
**
Mandatory
20,563.4
28,865.5
28,865.5
28,865.5
**
Discretionary
6,478.1
6,216.0
6,330.4
6,585.7
**
II: Conservation Programs
991.9
814.4
939.8
964.0
**
III: Rural Development
2,413.8
2,458.1
2,471.0
2,534.5
**
IV: Domestic Food Programs
52,488.4
58,956.7
58,700.6
58,711.7
**
Mandatory
46,936.6
53,126.4
53,122.4
53,118.4
**
Discretionary
5,551.8
5,830.3
5,578.2
5,593.3
**
V: Foreign Assistance
1,520.9
1,219.4
1,441.0
1,483.5
**
VI: FDA & Related Agencies
1,543.7
1,599.1
1,584.4
1,590.4
**
VII: General Provisions
(409.8)
3.6
(11.0)
(17.3)
**
Total, Before Adjustments
85,590.4
100,133
100,322
100,718
**
Scorekeeping Adjustmentsd
(464.0)
(571.5)
(669.9)
(552.0)
**
Grand Total, After CBO
85,126.4
99,561.4
99,651.7
100,166
**
Scorekeeping Adjustments
Mandatory Programs
68,294.0
82,822.0
82,822.0
82,818.0
**
Discretionary Programs
16,832.5
16,739.4
16,829.8
17,348.0
**
Budget Allocation (302(b))
n/a
n/a
16,832.0
17,348.0
**
Other emergency appropriations
not in this bille
3,849.0
0
0
0
**
Source: CRS, using tables from the House and Senate Appropriations Committees.
* indicates the amount of loans (authority) that can be made. The appropriation includes only the subsidy.
** indicates FY2006 bills or amounts that are pending.
a. FY2005 enacted levels include appropriations in the Consolidated Appropriations Act, 2005 (P.L. 108-
447), adjusted for the 0.8% across-the-board rescission to all discretionary accounts.
b. Under current law, the Commodity Credit Corporation and the Federal Crop Insurance Fund each receive
annually an indefinite appropriation (“such sums, as may be necessary”). The amounts shown are
USDA estimates of the necessary appropriations, which are subject to change.
c. General provisions in Title VII affect programs administered under various other titles.
d. Scorekeeping adjustments reflect the savings or cost of provisions that affect mandatory programs (as
estimated by the Congressional Budget Office (CBO)), plus the permanent annual appropriation made
to USDA’s Section 32 program. Adjustments for the FY2005 appropriation exclude emergency
appropriations. Adjustments for the FY2006 request are Administration estimates and do not reflect
an official CBO score.
e. The Hurricane Disaster Act of 2005 (P.L.108-324) contained $2.9 billion in emergency assistance for
producers and $575 million in other emergency funds for conservation and rural development
programs. The Emergency Supplemental Appropriations of 2005 (P.L. 109-13) contained $344
million in P.L. 480 food assistance grants and conservation watershed programs.

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